Three Faces of Veneto Wine: A Wine Economist Report

Titian’s famous painting Allegory of Prudence  (1565-70) is one of my favorite works of Italian Renaissance art. I stand before this painting and ponder it whenever I visit the National Gallery in London.

The three faces represent three sides of human nature: the loyalty of youth (represented by the dog), the courage of maturity (the lion) and the wisdom (or is it cunning?) of old age (the wolf).

It is a complicated painting that can be read on many levels, but one interpretation is that loyalty and courage much be tempered by prudent wisdom (hence the title). Or perhaps it is that wisdom is the product of loyalty and courage accumulated over one’s lifetime.

Whatever your reading, it seems that all three characteristics exist at once in most people, but since we are complicated folks, they come out in varying proportions at different times.

Wine has many faces, too, and this is especially true of Italian wine. The Veneto region of Italy is interesting in this regard because it is home to the big (it produces the most wine of any Italian region) and the small, the cheap and dear, the … well, you get the idea.

We were fortunate to be exposed to many different faces of the region’s wines during our recent visit. Last week I reported on the Prosecco producers we visited in Conegliano, where I lectured at the famous wine school. This week’s column looks at three faces of Vento wine we discovered on the next leg of our tour.

From Conegliano to Valdobbiadene

Our journey took us from Conegliano to Valdobbiadene, the two poles of a wine zone officially knows as Conegliano-Valdobbiadene Prosecco Superiore DOCG. It would save everyone a lot of trouble if they shortened this mouthful of a name to something simpler such as Prosecco Superiore, but I don’t really see this happening soon.

Someone told us that Conegliano Prosecco has more structure and Valdobbiadene Prosecco more fruit and, when I asked a friend if this is true he just shook his head and smiled. This is Italy, he said, and everyone is loyal to their locality, so everyone must be the best at something. And so  Conegliano-Valdobbiadene it is likely to remain, despite the marketing challenge, reflecting a certain combination of creative tension and political equilibrium.

The landscape of Valdobbiadene is quite stunning, with steep hillsides of vines. No wonder if is being considered for UNESCO World Heritage site status. And the wines are quite stunning, too.

Going Small at Silvano FolladorP1100182

A visit to Silvano Follador presented on intriguing face of Valdobbiadene wine personality. Silvano Follador inherited a few hectares of vineyards from his grandfather and produced wine from those vines and purchased grapes until, in 2004, when he made the choice to go small and to stick to estate fruit.

Now, working with his sister Alberta who met with us at the winery, he makes tiny amounts (about 2000 – 2500  cases) of beautiful wines working as naturally and sustainably  as possible. It takes courage to be small in a business where capital, technology and economies of scale are key factors.

Our interview and tasting with Alberta was conducted entirely in Italian and Sue and I were struck by the elegance of both the wines and the language Alberta used to describe them and the philosophy behind them. Tasting the wines with her was a very personal experience, which I suppose is what these wines are all about. The focus is very intense here — on the land, the seasons, the philosophy.

The wines deserve the global attention that they receive — they were featured in the copy of Slow Wine 2014 where we discovered them — but with production necessarily limited to estate fruit — and the idea of expansion or buying in grapes off the table — only a few of the world’s Prosecco drinkers will taste these wines. If you find them, do not hesitate!

Going Big at Bisol

Is going small the only way to preserve quality and a sense of place? It certainly works for Silvano Follador, but scale and quality are not mutually exclusive as we learned when we visited the much larger Bisol winery just up the road. The Bisol family has deep roots in Valdobbiadene, with evidence of grape cultivation going back as far as 1542. The business today is still all about family and, if the scale has grown the family-oriented philosophy remains.

We had our first taste of Bisol Prosecco from the iconic Cartizze zone last fall when we were in the Veneto on other business. Cartizze is the peak of the Prosecco pyramid, a small mountain covered in 106 hectares of vines that are divided up among 140 owners (Follador has a small plot of very old vines near the base of the mountain).

The Cartizze wines are so special and command such high prices that in the rare cases when vineyards go on the market they are exchanged for as much as 2.5 million Euro per hectare, or about a million dollars per acre. The vineyard scenes in the video above give you a sense of the territory. Given this it is perhaps unsurprising that we wanted to visit Bisol on this trip and learn more.

Bisol is both big and small, local and global, and this, along with the family philosophy, is the key to its success. Thinking big means thinking in terms of a portfolio of Prosecco wines that includes the popularly priced Jeio label and then moving up to Bisol Crede, a larger volume DOCG wine.

Quantity supports and enables quality and the smaller production Bisol wines really shoot for the stars. Here is a list of exceptional Bisol wines we tasted at Venissa in September 2014. We tasted many of these wines again in June in the company of Desiderio Bisol and export manager Stefano Marangon.

 Bisol “Crede” Prosecco DOCG  2013  (“Crede” refers to the marine limestone subsoil of the growing area) that we have tasted before here in the U.S. A premium and traditional DOCG Prosecco.

Next, in a silver-clad bottle, was Bisol noSO2 Prosecco Extra Brut 2012 . NoSo2 — no sulfites — in the “natural wine” style.

Bisol Relio Extra Brut 2009  came next, made from the Glera grape commonly used in Prosecco but using the classic method (secondary fermentation in bottle not tank). Different from the Sorelle Bronco sur lie wine — the Champagne style yeastiness more pronounced.

Following this we were served Bisol “Eliseo Bisol Cuvee del Fondatore” Millesimato 2001 — Pinot Noir, Pinot Blanc, Chardonnay grapes, classic method. Italian Champagne, you might say (if such language were permitted) with Pinot Blanc taking the place of Pinot Meunier in the grape blend.  Note the vintage date! Quite spectacular.

The last sparkling wine of the evening was the opulent Bisol Cru Cartizze DOCG –– from the prime Cartizze zone. I felt fortunate to taste wine from Cartizze both here and at Mionetto. A friend had warned me that Cartizze would be too sweet but I found both wines dry and well balanced. Prosecco, like Champagne, can be and is made in different degrees of dry and sweet and some styles are more popular than others in particular markets.

The final wine was sweeter but still very well balanced and it came as a complete surprise. It was Bisol Duca de Dolle Prosecco Passita — dessert wine made  with air-dried grapes like a white Recioto, but aged in a modiied solera system you find with some Sherries. A unique experience — different from any of the other wines from this region we tried and not exactly like any other sweet wine, either.

The Bisol website proclaims that the family aims to be at the cutting edge of tradition, and I think this is a wise (or perhaps cunning) approach. They use the capital and technology and take advantage of the economies of scale, but without losing sight of first principles.P1100186The Colli Euganei and Maeli Estate

Loyalty seems also to be a characteristic of the Bisol family and it shows up in unexpected ways. Venissa, the vineyard, restaurant and inn on an island in the Venetian lagoon, is a project of Gianluca Bisol that aims to honor the deepest traditions of Venetian winemaking. At Gianluca’s suggestion, Sue and I drove from Valdobbiadene to Villa Vescovi in the Colli Euganei to visit another project that honors tradition: the Maeli  Estate of Elisa Dilavanzo.

We had never been to the Euganean Hills before and we found the geography quite striking. The hills seem to erupt from the plain in a way that suggests their volcanic origins. So close to Venice that you can see San Marco from the hilltops on a clear day (our day was not so clear, alas), this zone supplied Venice with traditional wines and agricultural products for ceP1100200nturies. Now, however, there is pressure to shift from traditional wines to international grape varieties that are sometimes easier to sell, which is understandable but a loss to wine’s diversity if the trend goes too far.

With Gianluca Bisol’s support, Elisa Dilvanzo has dedicated the hilltop Maeli estate to try to preserve some of the wines and traditions of the Colli Euganei and to develop markets for them, too, since one way to preserve tradition is to demonstrate its value.

We tasted a number of quite fascinating wines and walked the vineyards, too. The wine that stands out in my memory and that I will always remember is the wine shown here: a Fior D’Arancia DOCG made with indigenous Moscato Giallo grapes. The wine really does remind you of orange blossoms. It makes a strong statement that winemakers should be loyal to their heritage even as they reach out to the global markets that can support their efforts.

Maeli’s strategy is to begin by exploring Moscato Giallo in all of its many possible expressions, then continue the journey with other red and white wines that have deep roots in the region. These include Bordeaux varieties that were introduced by the French here long ago. We tasted a delicious wine called “D+” — Merlot, Cabernet Sauvignon and Carmenere — and joked about the name. In the United States “D+” is a poor grade — better than D- but worse than C-.  Here, however, it means “even more” and that’s what this wine (and the project) aims for while still staying loyal to the past.

>>><<<

And so here are three faces of Veneto wine. Are these the three faces of Veneto wines? Oh my, no — just scratching the surface. But they show the rich diversity of this impressive region and, like Titian’s painting, represents three sides of Venetian wine character. Thanks to everyone at Silvano Follador, Bisol and Maeli estate for giving us a taste of their wines and a peek into their worlds. Special thanks to Michela De Bona for all her help. Photos by Sue Veseth.

Wine Wars in Prosecco’s Home: A Report from Conegliano

Sue and I spent 12 days in the Italian Northeast last month and this is the first of an series that reports our experiences in this colorful piece of the Italian wine mosaic.

Conegliano Genesis

We came to  Italy in response to an invitation to speak at the Scoula Enologica di Conegliano,  the famous wine school in Conegliano — which I like to think of as Italy’s equivalent of UC Davis in the U.S. Students come here from across Italy to train in viticulture, enology and also to study the business of wine.

Because of its location and history, there is a special focus on the wines of the Veneto and perhaps especially Prosecco, the famous sparkling wine.  Indeed, the statue you encounter as you approach the school is of the founder, Antonio Carpenè, who is also the originator of the “Italian method” of making sparkling wines (secondary fermentation in autoclave, not bottle), which is used today to make most Prosecco wines and many other sparkling wines around the world.

Interest in the U.S. market is very high these days in Italy (as it is in most winegrowing regions around the world), so I had an attentive audience for my seminars on “Anatomy of the U.S. Wine Market” and “Wines of the Veneto: A SWOT Analysis of the U.S. Market.” Anna Paola Giacobazzi, export manager at Cantina Della Volta, came all the way from Modena for the first seminar, bringing with her a bottle of Cantina Della Volta’s award-winning and distinctive Rimosso,” a Lambrusco made using the classical method and bottled sur lie. Stunning color and distinctive flavor! I’ve never tasted anything like it!

The opportunity to meet with researchers from the wine school and to visit wineries in the Italian Northeast was too good to miss, so we spent several days touring the region visiting a small group of distinctive wineries. Each winery told a different story and I am still working to put them together into a coherent story for a future book project.

Giro [Northeast] d’Italia

The Giro D’Italia is Italy’s elite professional bicycle race (the Italian competitor to the Tour de France). The race, which was won this year by Alberto Contador, passed through the Italian Northeast a few days before we did but sometimes it seemed like we were climbing higher and higher like the racers themselves — not just in terms of altitude but also quality and sophistication. It was an elevated experience to be sure.

We visited four wineries in Conegliano and they presented us with a classic “compare and contrast” exercise. What did they have in common? Prosecco, of course, and the traditional still wines of this region. They all displayed an emphasis on quality and an obvious  rising ambition. With Prosecco’s recent success and the continuing popularity of Pinot Grigio, everyone sensed that this might be the Veneto wine industry’s moment to take the next step in export markets and especially in the United States.

The contrasts were striking, too. These wineries differ so much in their size, scope and history and because of this their strategies are very different, too.  Herewith four brief profiles to illustrate my point.

Paladin: Prosecco and  More (including a surprising Malbech!)

Our wine school hosts first guided us to Paladin, an innovative family firm that celebrated its 50th anniversary in 2012. Prosecco is the name of the game here, of course, and it came in all of that wine’s many delicious forms. A great beginning.

The Bosco de Merlo line featured many fine still wines, both red and white, in addition to bubbles, with an emphasis on regional grape varieties. At my request we tasted a Malbech (my first Italian Malbec!), a wine with a longer history in this region than I would have guessed and a celebrated part of the Paladin portfolio. Can it be true that Italian immigrants introduced Malbec to Argentina? If so, we owe them a debt of gratitude.

Paladin’s strategy is multi-region: they also owns an award-winning  winery in Franciacorta (Castello Bonomi), which was recently named Italy’s best sparking wine, and a winery and beautiful agritourism facility in Rada in Chianti, Borgo Castelvecchi.  The same team directs winemaking at all three locations, maintaining a consistent emphasis on quality.

We learned that tradition is important at Paladin, but that innovation and imagination are honored and embraced. The whole operation is very analytical and data-driven — but rigor and respect for tradition are not mutually incompatible.  Soon we found ourselves out in the middle of a Paladin vineyard in the company of viticultural scientists from the wine school. Together Paladin and the school are doing research to discover how winegrowing itself might mitigate wine’s big  carbon footprint.

The vines apparently take carbon from the atmosphere as they grow. How? And how much? These are the questions that this rather sophisticated project seeks to answer and the researchers are optimistic that their studies will yield results that will be good news to environmentally-concerned winegrowers and wine drinkers everywhere.

Ponte: A Progressive Cooperative

On the way to Paladin we drove by La Marca, a big Prosecco operation and maker of one of the best selling Proseccos in the U.S. We learned that is a second-level cooperative — a cooperative of cooperatives — with the resulting size and economies of scale. Our next stop after Paladin was different  cooperative, Ponte, which is also quite large (14 million bottle annual production) if perhaps less well-known here in the U.S.

Cooperatives are born in times of crisis — when growers have no choice but to make wine with their own grapes because no one will buy them and so growers band together to share risk, cost, and expertise. Ponte was born in the postwar wine crisis year of 1948. It started with just a handful of growers and now has grown in scale and scope, with 1200 members farming 2000 hectares of vines.

American wine growers please read those numbers again. 2000 hectares (about 5000 acres) and 1200 members. The average vineyard holding is 1.7 hectares or about 4.1 acres per member and, since this is an average, you know there are lots of vineyard plots of one hectare or less in the mix. Making such tiny holdings profitable is a huge challenge and puts a lot of pressure on the cooperative to be efficient in its operatives and successful in marketing the wines.

Ponte makes dozens of different wines at many price points but, unlike some of the old style cooperatives you have heard about, the goal here is not simply to dump plonk into the bulk market. Despite the scale and fragmented ownership, we learned, there is a focus on quality that displays itself most prominently in a line of sparkling and still wines that honor Teatro la Fenice, the famous Venetian theater.

Like the successful cooperatives we discovered in Alto Adige a few years ago, Ponte is very demanding of its cooperative members, who must supply grapes of high quality to get the best prices. Then it is up to the winemakers in the vintage winery (distinctive state-of-the-art architecture when it was built  in the 1950s, state of the art production technology today).  Interestingly, Ponte’s portfolio also includes wines from outside the Veneto:   Champagne de Castelnau from Reims, France, MonteStregone from the Piedmont, and Nuraghe Crabioni from Sardinia.

In Tune with the Times at Borgoluce

One of my themes in speaking about marketing wine is the importance of seeing wine as consumers do, as part of a life experience that often includes food, travel and culture. The fact that Americans think about Italian wine in this way gives the Italians a big advantage over wines from other regions. Borgoluce understands this holistic message and has embraced it to a degree that frankly caught us  off guard.

Borgoluce is all about wine  — Prosecco of course and also red and white still wines —   but wine sometimes faded into the background just a bit (except at lunch) when considered alongside the bigger enterprise: a large family estate with vines but also pigs, beef and buffalo (raised for both their milk and their meat). Sustainability and accountability are watchwords here and key to the experience whether in the shop, where wines and other products of the estate are sold, the osteria up in the hills where farm-to-fork is the name of the game or in the farmhouse holiday venues.

Ludovico Giustiniani showed us around, taking obvious pride in the environmental accomplishments and “triple bottom line” approach and the opportunity that Borgoluce presents to those who want to reconnect with the land, nature and ultimately I suppose themselves. But, having said earlier that wine sometimes seemed in the background, it is actually the foundation of it all since from an economic standpoint wine makes possible the tremendous investment in agriculture, hospitality and tourism. The Borgoluce wines we tasted were great, but Sue and I will always remember the values they stand for, which seemed to us to be entirely in tune with the times.

Past, Present and Future at Carpenè

Our final winery visit in Conegliano completed the circle — from the wine school that Antonio Carpenè founded to the winery he built: Carpenè Malvolti, the original Prosecco producer. Brand manager Roberta Granziera was in the audience for my lectures and arranged for us to meet with global sales and marketing manager Domenico Scimone at the historic downtown winery.

Once upon a time Carpenè was synonymous with Prosecco (you asked for a Carpenè not a Prosecco much as someone might ask for a Kleenex not a tissue) and this is still true in some places. Carpenè is number one in its category in China, we were told. But Prosecco’s rapid growth has weakened both this brand identity and the identity of the wine itself. To many consumers who have just discovered this product it is not clear that Prosecco is a product of place rather than the name of a grape variety.

Carpenè’s intent is to reestablish Prosecco’s identity, connecting the history and the territory. They are confident that once consumers really understand Prosecco’s history and appreciate it is a product of a particular region (not a generic grape designation), then they will reach for wines that represent these ideas, including especially Carpenè Malvolti. One project that got our attention was a very limited production luxury wine called PVXINUM after the first reference to Prosecco (as a still wine) found in Pliny the Elder’s works.

Carpenè aims to lead from the front and we were impressed with the wines, the people and the strategies we discovered here. Very different from our other Conegliano visits, but that makes sense since each of these wineries is so distinct in history and personality. A good foundation for the next stop on our tour.

>>><<<

Thanks to everyone who met with us during this quick trip and extra special thanks to our hosts at the Conegliano wine school: Professors Vasco Boatto and Luigi Galletto, Luigino Barisan, Gianni Teo, Tanja Barattan and Michela Ostan.

California Conundrum: The Best of Wines, The Worst of Wines?

“It was the best of wines, it was the worst of wines (apologies to fans of Charles Dickens). The global wine glass seems both quite empty and full to the brim.”

These are the opening lines of my 2011 book Wine Wars and if you change “global” to “California” they apply very well to the situation today.  That’s why I will be in Napa Valley next week, speaking at the California Association of Winegrape Growers‘annual meeting summer conference (I’ll paste the conference program at the end of this column). There’s good news for California wine these days and bad news, too.

When is a Drought a Good Thing?

The good/bad – best/worst situation exists in several dimensions. Take the case of water. The on-going drought in California is on everyone’s mind, but its impact has been very different in different regions. The recent news from Napa Valley, for example, is that the drought can be beneficial  in terms of wine quality. Smaller grapes, the story goes, produce more intense wines. Good news for those who drink or make Napa Cabernet, we are told.

drought

I can’t tell you how many of my friends have told me how amazing it is that four years of drought are actually good for California wine! Really? Well, I’m amazed too, but because there much more to California wine than Napa Valley. To focus just on Napa and the North Coast as many articles have done is misleading about the overall situation.

Napa Valley produces a lot of wine, but it is more or less a drop in the bucket compared with the huge wine production in other parts of California where the drought situation is very different. Higher costs and lower yields are not good news to most California producers, who are less able to extract a quality premium and suffer falling margins.

Many winegrowers have grubbed up their vines, in fact, switching to higher-value crops in the face of poor winegrape profitability. Paradoxically, however, some farmers are actually switching into grapes from other thirstier or less drought-tolerant crops, presumably because they see scarce water as a long term trend. It’s a complicated situation.

Demand and Supply Apply (As Usual)

Changing market conditions add to the good news/bad news conundrum. Rabobank reports that the current excess supply situation for under-$10 California value wines (as opposed to higher-price North Coast and mid-price Central Coast  wines) is likely to go from a worrisome problem to a real crisis in the next few years, as this graphic suggests.

supplydemand

A recent report by Allied Grape Growers reinforces this message. AGG President Nat DuBuduo noted grape prices as low as $15o per ton in the San Juaquin Valley and as high as $6000 per ton in the North Coast.

Part of the problem is that, for reasons I discussed earlier this year on The Wine Economist, the momentum in wine demand has shifted to premium and super-premium wines with lower-priced wine sales stagnant or falling. At the same time, however, potential production of value wine is about to increase dramatically because of vineyard decisions made a few years ago when market conditions were much different.

Rabobank estimates that 100,000 acres of currently non-producing wine grapes will come into production in the next three years. That my friends is a lot of wine to sell. Where is the increased acreage? Don’t look in Napa Valley, where rising demand and limited supply push prices higher and higher. Some of it is in the Central Coast, according to Rabobank, where demand is rising to potentially match the larger supply.

A lot of it is in the Central Valley when California’s value wines are produced and where prices are already low. This emerging wine lake will add to the current problem of full tanks and lackluster sales of value wines. Bad news for Central Valley winegrowers who are most affected by this pattern.

Best of Wines and the Worst, Too

Best of wines, worst of wines? The Rabobank report suggests a building crisis in one part of the California wine industry while it’s happy days in the North Coast with Central Coast wine seeking to balance rising demand and supply.

My job at the CAWG meetings will be to analyze the international and global aspects of the complicated situation and my remarks will suggests that this is a time of great uncertainty on these fronts, with important risks that might not come from usual sources. Combined with what the other speakers will offer I think it will be a great discussion.

Here’s the agenda for the sessions. Hope to see many of my California wine industry friends in Napa.

>>><<<

CAWG’s Annual Business Meeting & Conference, on Thursday, July 23, 2015

Wine Market Update and Insights explores the interplay between current trends in U.S. wine consumer behavior, the influence of foreign wines in the U.S. market, and what California growers and wineries need to do to stay competitive. Mike Veseth, Editor of The Wine Economist and John Gillespie, Wine Market Council president, will speak.

How Do We Grow the Market for California Wines? Wine consumption in the United States continues to grow, but that growth is unevenly distributed and competition in the domestic beverage alcohol market is fierce. California winegrape growers must compete with foreign wine growers, and domestic producers of craft beers and distilled spirits. This session will consider the  current trends, conditions and future views on wine industry growth, consumer demand trends and how growers and wineries must position themselves to compete and grow market share here and abroad. Amy Hoopes, Chief Marketing Officer/Executive Vice President, Global Sales, Wente Family Estates and Rob McMillan, Executive Vice President and Founder Silicon Valley Bank Wine Division, will speak.

Update from Washington, DC will highlight a variety of federal policy issues, including taxes, water, immigration and more. Louie Perry, CAWG’s federal lobbying team member from Cornerstone Government Affairs in Washington, DC, will provide the update.

The View from Trinchero Family Estates will be the luncheon keynote address from Bob Torkelson, president and COO of Trinchero Family Estates. Mr. Torkelson will share his insights and analysis on leading industry trends and issues.

The 41st Annual Business Meeting will take place after the speaker program, during lunch.

 

The [Sometimes Slow] March of the Kiwi Terroirists

slowhorseLast week’s column looked back to the concerns about terroir and geographical designations a few years ago when Sue and I visited New Zealand to gather material for my book about globalization, Globaloney. There was frustration and anxiety about how to delimit the Kiwi vineyards and concern that things weren’t moving fast enough.

The people in Hawkes Bay were so frustrated that they took  matters in their own hands, creating and trademarking the Gimblett Gravels region! Well, the good news is that progress is at last about to be made on the policy front although the promise of progress hasn’t stopped winemakers from trying to speed things along through their own branding strategies. Here’s a quick report.

The Slow Horse Theory

My friend Woody says that justice rides a slow horse and, if that’s true, then the new Kiwi geographical indicator policy must be just indeed. It certainly has been slow in coming!

I was struck by a recent Decanter article about New Zealand geographical indicators for wine.  “Ministers said …that they would put into practice the Geographical Indications (Wine and Spirits) Registration Act – first passed as long ago as 2006 but yet to enter into force.” The  reason for the rush to get the law implemented is a concern over international competitiveness.

‘The act will set up a registration scheme for wine and spirit geographical indications, similar to the trademark registration scheme,’ said New Zealand Trade Minister Tim Groser.

‘Being able to register wines and spirits geographical indications here will make it easier for their users to enforce them in New Zealand.
‘It will also make it easier for our exporters to protect their geographical indications in some overseas markets.’

Since the New Zealand industry is very dependent on exports, it makes good sense to bring Kiwi practices into line with the global rules of the game.

The move was ‘warmly welcomed’ by generic body New Zealand Winegrowers, whose CEO Philip Gregan said: ‘It will equip the industry with the tools to protect its premium brand from misappropriation or misuse, as well as help secure market access in some regions.

‘It’s a big step forward for the industry.’

A Bill to amend the Act will be introduced to New Zealand’s Parliament later this year, and the Act is expected to be passed by the end of 2015.

Paul Goldsmith, New Zealand’s Commerce and Consumer Affairs Minister, noted that some consumers are prepared to pay a significant premium for wines from certain New Zealand geographic regions.

“The reputation of New Zealand wines must be jealously guarded if we are to continue growing our wine exports.

“The ability to register geographical indications under the new Act will help our wine industry promote and protect its premium brand from misappropriation or misuse by overseas producers, as well as secure access in certain markets which require government-recognised geographical indications.”

Good idea. But what took so long?  I found an analysis of the situation on the Baldwins intellectual property law website which provided useful background. Apparently passing the geographic indicator act back in 2006 wasn’t enough — it is also necessary for the Governor General to issue an Order in Council, which was not done (as was the case with a previous geographical indicator act from 1994).

I have not been following this situation, so perhaps there have been very good reasons for the long delay in implementing the GI act. As I noted last week, some think that it might be premature to set down strict boundaries or worry that appellations in general have gotten out of control.  But clearly the NZ wine export sector’s needs are now being given priority. With a little luck they can begin to use the new system next year. Slow justice I suppose. I’d appreciate comments from those in New Zealand who are directly affected by the change. Are there issues here that don’t show up in the news stories?

Marlborough Pioneer Brancott Estate

I hope the geographical indicator law, when it is finally implemented, will provide New Zealand producers with the protections and processes that they need. But in the meantime terroir grows in importance every day in the global market as upscale consumers look for markers of integrity and authenticity in everything they buy. Wines of origin designations don’t guarantee these qualities, but they are a way to signal intent to buyers.

Smart Kiwi producers are doing their best to exploit terroir both in bottle and as brands, a fact that was clear when we were invited to participate in a digital wine tasting of Marlborough Sauvignon Blanc organized by Pernod Ricard’s Brancott Estate.

Brancott Estate is the pioneer Marlborough Sauvignon Blanc producer. The photo at right shows Frank Yukich planting the first Marlborough Sauvignon Blanc vine at the Brancott vineyard in Marlborough in 1975. If  you look closely you can see he is “fertilizing” the vine with a silver coin and irrigating it with Champagne.

The Yukich family’s company, Montana Wines, eventually changed hands and current owner Pernod Ricard rebranded it globally as Brancott Estate a few years ago. I suppose the Montana brand wine was never going to be an easy sell here in the U.S. where a wine from Montana can have more than one meaning, but Brancott Estate is a hit, hence our digital tasting.

P1090870There were five wines in the tasting flight, starting with a low alcohol Sauvignon Blanc called Flight Song and moving on to the mainstream Brancott Estate wine that is widely distributed here in the U.S. Then we climbed up the wine ladder from Stoneleigh Latitude (Stoneleigh is a sister winery to Brancott) to Brancott Estate Letter Series and ending with the Brancott Estate Chosen Rows (tiny production — not currently available in the U.S. market).

We tasted the wines in the company of Sue’s parents Mike and Gert with Brancott winemaker Patrick Materman as our virtual guide via a web link. The low alcohol Flight Song, made from early-harvest grapes, was not a favorite, but the popular Brancott Estate bottling was well received with its classic Marlborough flavors and aromas. A good reference point for the wines that followed.

The Stoneleigh Latitude Sauvignon Blanc is made from vines planted in Marlborough’s “Golden Mile,” where river rocks carpet the vineyard floor capturing the sun’s heat. Stoneleigh focuses exclusively on wines made from this one vineyard area. This wine, my favorite of the flight, displayed unexpected minerality on first taste and rich fruit when re-tasted an hour later and then the next day.

The Letter Series wine came exclusively from vines in the original Brancott vineyard (and not a regional blend) while the Chosen Rows (my second favorite) was sourced from a selection of the best rows of vines from Brancott. It was noticeably more serious and elegant — and more expensive. It’s s shame that it is made is such limited quantities because it might change some minds about Marlborough Sauvignon Blanc. I hope I have an opportunity to taste it again.

Strengthening Brand Marlborough

Together these wines demonstrated, just in case anyone had doubts, that Marlborough’s particular terroirs show themselves in the wines and that Pernod Ricard and the Brancott team are committed to making these wines and telling terroirist stories to go with them.

Focusing on the vineyard level with a particular brand isn’t the only way to tell the story, but it’s one way to do it until a more formal system of geographic indicators is in place. And even when sub-regional designations are improved, the vineyard-level story will be powerful and relevant.  The time is ripe for a terroirist take on New Zealand wines and producers are ready to rock and roll.

>>><<<

Here is a march to accompany the [slow] implementation of the New Zealand legislation. Perhaps you have heard it before?

Kiwi Wine Wars: Terroir and Its Discontents

When Sue and I visited New Zealand in 2004 we found a wine industry experiencing tremendous success, but worried that the good times might not last. It seemed like New Zealand’s wine production was doubling every few years — could global markets continue to absorb so much Kiwi wine?

Eleven years later the conclusion is that global consumers still love Kiwi wine, but the concern is still there for the future.

A Kiwi Variant of the Dutch Disease? 

There were lots of worries back in 2004. One was a kind of Kiwi variant of the “Dutch Disease” — the concern that tremendous success in one part of the wine industry would put a curse on the rest of it. Would the triumph of Marlborough Sauvignon Blanc crowd out other regions and winegrape varieties and leave New Zealand uncomfortably reliant on a single type of wine?

But that wasn’t the only problem people saw then. Ironically, we met with one very successful Marlborough producer who was worried about Pinot Noir messing up Sauvignon Blanc. New Zealand’s brand is Marlborough Sauvignon Blanc, he told us. Giving more attention to Pinot Noir risks confusing consumers about the Kiwi wine identity and killing the goose that lays the golden egg.  Put all the chips on Marlborough Sauvignon Blanc and make sure that very successful and profitable wine doesn’t fade away, he advised.

Eleven years later I think the concern about reliance on Sauvignon Blanc is  still around, but I’m not hearing much talk about Pinot Noir getting too much attention for the industry’s good. And that producer who wanted to deemphasize Pinot is now proud to make some highly-regarded Marlborough Pinot Noir in addition to his Sauvignon Blanc!  So a lot has changed even if some things stay the same.

 It’s Terroir Time

One concern that is still on the agenda is terroir and its importance in marketing the wine by telling an authentic terroirist story. As I have suggested in previous columns, terroir designations have morphed from a protective tool in Europe (an attempt to control fraud, for example, and protect geographical trademarks) and a brand issue here in the U.S. (brand Napa Valley) to an indicator of authenticity in the story-telling necessary to effectively sell wine today.

It’s terroir time in wine world. Upscale consumers want to have authentic stories to go with the products they buy — this is true for wine and other products — and a specific geographic designation is one way (but not the only way) for winemakers to tell that story.

Some of the people we talked with in Marlborough back in 2004 were thinking in terms of protection and brands and they were worried by New Zealand’s lack of a stronger geographic indicator system for wine. Marlborough is a very large designation, one producer told me, and it is a powerful brand for Sauvignon Blanc. But it is such a big and diverse area, he said, and the wines are so diverse in terms of style and quality.

He was afraid that as production was ramped up the lack of consistency would undermine Marlborough’s credibility. Private efforts to stress particularly excellent sub-regions did not seem to be getting traction and official actions looked slow in coming. Would Marlborough’s success ultimately undermine its credibility? That’s the pattern that I called “the Curse of the Blue Nun” in Wine Wars.

NZ-based wine writer Rebecca Gibb recently wrote about the movement to identify key Marlborough zones for Pinot Noir, concluding that as appealing as the idea is it might be premature. Maybe Kiwi winemakers are still learning where the the best places are to grow particular varieties, Gibb says. If she’s right then it was certainly too soon back in 2004, when the zones might have been crafted with SB, not Pinot, in mind. And Jamie Goode has recently cautioned about the movement to adopt geographical indicators in general.

Gimblett Gravels: Seizing Control

We visited Hawkes Bay on the North Island in 2004 and some of the winemakers there were impatient with Kiwi geographical indicator policies. Growers in the Gimblett Gravels knew that they had special terroir and, having saved it from exploitation as a gravel quarry, wanted to both protect it and brand it. But how?

They did both in the most direct way available to them, forming an association, registering “Gimblett Gravels” as a trademark and rigorously regulating its use. In essence I guess they “privatized” their terroir designation because they were frustrated with the lack of a clear public path.

Here is an explanation from the GG association’s website.

GIMBLETT GRAVELS is the registered trademark of the Gimblett Gravels Winegrowers Association. The Association and registered brand were developed to define and then name a winegrowing district using principles that are not catered for within New Zealand’s proposed Geographic Indications Act legislation.  … The Association and designation of the area was formed at a relatively early stage in its winegrowing life to ensure that the purity and integrity of its designation was not compromised by political issues outside its control. … To the best of our knowledge this is the first viticultural appellation in the New World where its ultimate boundary is defined by a distinct soil type boundary, no compromises, no politics.

The approach taken has determined that a carefully planned and professional branding program was required to promote the Gimblett Gravels Winegrowing District as a viable sub-region within the Hawke’s Bay region. The lack of any legal Geographic Indication status for Gimblett Gravels Winegrowing District has determined this approach. The branding program has developed a strong logo and branding platform that controls the use of the name “GIMBLETT GRAVELS” and “Gimblett Gravels Winegrowing District”.

Kiwi Terroir Today

I suspect my friends here in the U.S. who are caught up in various aspects of AVA and sub-AVA politics will look at the Gimlett Gravels initiative with respect, admiration and even a bit of envy. What a bold move! And I think it has been very successful, too.

Terroir and geographical indicators have grown and changed in their significance. Where does New Zealand stand today? Come back next week for a quick look at progress on this front both in private sector branding  and in Kiwi wine policy.

Natural Cork vs Alternative Closure Wars: Race to the [Wine Bottle] Top

At the end of my review of To Cork or Not to Cork, George Taber’s informative 2007 survey of the wine bottle closure wars, I vented some frustration. Not with the book, which is great, but with the closures themselves. Taber taught me that no wine bottle closure was perfect, although he had high hopes that competition among closure producers would make the future brighter. Here’s the conclusion of my 2007 column.

[Taber writes that]  … finding a solution to the wine closure dilemma is a worldwide problem and global market competition is forcing the stopper makers to innovate and make better and better closures and forcing winemakers to get better, too, since they can no longer automatically blame any flaws in their wines on bad corks. “Unfettered competition,” he writes, “remains a powerful driving force for good.”

I think Taber is right, but for now I’m just standing here in the basement, looking with suspicion at the wine in my little cellar, trying to guess what is going on beneath the lids. Having read Taber’s book, I now know enough to be anxious about each and every bottle!

A Wealth of  Closure Choices

Eight years have passed and the closure wars continue. Perhaps the single most-asked question when I speak to consumer groups is about what’s at the top of the bottle, not the contents. “What do you think of screw-caps?”  Well, what should I think?

The question continues to haunt the wine industry. Recently two U.S. wine industry monthlies featured cover stories on the closure wars. “Alternative Closures Go Upscale” was the headline on the May 2015 issue of Wine & Vines. while the June issue of Wine Business Monthly featured their 2015 “Closure Survey Report.”

Jane Firstenfeld’s Wines & Vines article “Unconventional Toppers for Top-Shelf Wines” takes the form of a series of brief interviews with premium winemakers who report their use of screw-cap closures (including Van Duzer, Chehalem, Meoimi, Silverado and Sonoma-Cutrer) or synthetic closures (Schug and Eberle).

The article gives a sense of the great variety of alternative closures available (gone are the days of one-size fits all) and the research and trials necessary to assure the best possible fit between wine, winemaker and closure. It’s a good piece of reporting if you have a dog in this fight!

Natural Cork is #1. So are Synthetic Closures. Discuss.

Curtis Phillips presents the results of the Wine Business Monthly survey of winery closure use in his article “Natural Closures Rated Highest.” One colorful graph caught my eye — it showed the results of the survey for five years where respondents were asked which closures they used for their $14-$25 red wines? Options (more than one choice allowed) started with natural cork and moved on to technical cork, synthetic closures, screw caps and an “other,” category that includes Zork and Vino-Seal.

The graph suggests that natural cork is used by about 50% of the wineries surveyed, down from nearly 70% a few years ago. Technical cork is shown rising from about 20% to 30%, while ynthetic closures are roughly stable at a little more than 10% and screw caps are shown rising from about 10% to 30%.

The devil is in the details in surveys like this and to their credit WBM provides details that clarify the picture. The unit of analysis for the survey is the winery whether it is big or small, which changes up the conclusions you might otherwise draw.

Many more wineries use natural cork, but many more bottles of wine here in the U.S. are sealed by synthetic closures. The 10% of wineries that use the synthetics such as Nomacorc include some boutiques (Oregon’s Ken Wright Cellars, for example) and some giants (Gallo), so that about half of all wine bottled in the U.S. comes with a synthetic closure even though only about 10% of wineries surveyed use it.

There is more to the WBM story than this, of course. Winery respondents were asked to give their ratings of closure alternatives and the result is a rising tide — all of the closures were rated higher than they were a few years ago. When it comes to quality in wine closures, the trend seems to be up and up.

Creative Destruction in the Closure World

This did not surprise me because closure manufacturers keep me well-supplied with press releases about their newest innovations and I have been impressed with the way that they have responded to criticisms and invested in improved technology giving wineries higher quality and greater choice. There has also been something of a shakeout taking place over the years, with some producers dropping out of the market, increasing the scale of the others, which further increases the return to new investment.

The race to the top is true for natural cork, as Antonio Amorim and Carlos de Jesus made sure I appreciated when I met with them in Porto last year.  Natural cork producers made a terrible mistake when they did not recognize problems in past years, and they paid a high price in lost market share as a result, Amorim told me.

But better consistency, higher technical quality and strong consumer acceptance makes natural cork a competitor in every market, he said. And of course better natural corks force the other closure makers to raise their game, too. Winemakers and wine consumers certainly gain.

If there’s one area where cork closures would seem to have an unavoidable disadvantage over screw-caps, however, it would be convenience. Screw caps are just easier to handle and, with rising technical quality, that would seem to give it a big advantage in some markets at least. Even wine guru Hugh Johnson thinks so. His  May 2015 column in Decanter magazine proclaimed that “I am faintly irritated now when I come to open a bottle of wine and find I need a corkscrew.” Gosh! The screw-cap is “incomparably better” than natural cork, he says.

Do the Twist — Like This!

Well, Amorim doesn’t want to lose Hugh Johnson’s business (or anyone else’s) so last year they released a screw-cork closure called Helix.  That’s right — screw-cork (see the image above). The cork and specially-made bottle are designed so that the cork screws into (and out of) the bottle slick as can be.

Screw-cork? Amazing.Probably not as important in the grand scheme of things as the technical improvements in cork production at Amorim, but still a great example of how innovation occurs even in centuries-old industries like cork closures.  Is this an example of Taber’s idea that unfettered competition is a driving force for for good? When it comes to closures, it sure seems to be true. Here’s to the race to the top!

Best in the World? Gourmand International Wine Blog Award!

gourmandAs I mentioned back in January, everyone at The Wine Economist was delighted and just a little surprised to learn that we were short-listed for a major award.  The Gourmand International “Best in the World” awards are given annually to recognize excellence in food and drinks writing.  My 2011 book Wine Wars was honored by Gourmand International in one of the specialized categories when it was published.

This year there is an award for best blog. Here are the finalists.

award2

Best Wine and Drinks Blog:

The results were announced on June 8 in Yantai, China. I wanted to be there along with the other nominees in all the food and wine categories, but I was already committed to being in Conegliano, Italy giving a pair of talks at the famous wine school.

Well, the results are in and, to make a long story short, the winner is …

The Wine Economist? Yes! We at the Wine Economist are surprised and deeply honored by this recognition. Many thanks to everyone at Gourmand International for this award and personal thanks to Edouard Countreau for his support and encouragement.

award

 

Follow

Get every new post delivered to your Inbox.

Join 2,259 other followers