Desert (Not Dessert) Wine

[Note:  My senior Arizona correspondents m&n recently went searching for the Erath vineyards -- and they found them and Dick Erath's Arizona wine, too! Click here to read their report. Update posted 5/15/2011.]

Erath in Arizona

desert1.jpgI spent Friday in the Arizona wine country – south-west of Tucson near Sonoita – with my “research assistants” Michael, Nancy and Sue (Michael and Nancy took these photos). I thought that I would learn something from talking with winemakers here, and I did, but it wasn’t exactly what I expected. Here is my report.

I was drawn to explore Arizona wine by the news about Dick Erath’s investment there. Erath is one of the pioneers of the Oregon wine industry; his early wines helped establish the reputation of Pinot Noir in Oregon and he has been instrumental in the growth of the industry over the years. I think you can say that he is a legend in Oregon. Like many north-westerners, Erath likes to go south – to Tucson — during the winter months and he became acquainted with the nascent wine community there in the mid-1990s. He started buying vineyard property near Wilcox east of Tucson a few years ago and has planted vines there. He recently sold his Oregon brand to Ste Michelle Wine Estates (he still owns the vineyards) and is moving forward with the Arizona project.

Erath’s presence lends credibility to the region. People like me figure that Erath wouldn’t put his name, time and money here if he didn’t believe in the potential of Arizona wine.Wines from unfamiliar places always raise questions and Arizona winemakers hope to change the questions from “Arizona? Are you kidding?” to “Is Arizona the next Napa Valley?” Establishing credibility is the critical second step for an emerging wine region (achieving quality is the first) and Erath’s investment is an enormous advantage in this regard.

A Working Hypothesis

My hypothesis going into this research was that the wines themselves would be a bit problematic, as emerging region wines often are, and that the biggest challenge would be in the vineyard not the cellar — growing wine grapes in the high desert.

Our first two winery stops quickly made me change my mind about the quality of Arizona wine. The wines atDos Cabezas WineWorks were intense and flavorful, with a spicy complexity that surprised me. I am not a wine critic, so I will not bore you with amateur tasting notes and doubtful ratings, but we were very impressed with these wines and bought some to give as gifts to Arizona friends who did not know about Arizona wine. Todd Bostock, the winemaker, really knows how to draw flavor from Arizona (and some California) grapes. Todd is working with Dick Erath in addition to his own projects and I think this collaboration bodes well for Erath’s Arizona wines, when they are ready, and for the region’s reputation.

Our second stop was Callaghan Vineyards. Kent Callaghan’s wines were strikingly good. We noted the depth and distinctive character of these wines, particularly the Tempranillo- and Petit Verdot-based blends but also a Mourverdre, Syrah and Petite Sirah blend. These wines were different from Bostock’s and gave us a hint of the potential range of Arizona wine styles. Kent let us taste some library wines and the question, can Arizona wines age well, was answered in the affirmative. We bought wine and had it shipped home, which is I suppose the highest praise a wine consumer can provide.

We visited one other winery, a new one that I won’t name, that made the sort of wines that I originally expected to find – what I would describe as immature wines showing wood in the wrong places. They served to put Bostock’s and Callaghan’s achievements in context. It is possible to make very good wine in Arizona, but it’s probably not easy.

The Globe in Your Glass

Wines have started to appear from many regions not on the list of “usual suspects:” India, Thailand, Peru and Brazil, for example. Brazilian wines actually make a cameo appearance in the film Mondovino, but not in a way that makes them seem in any way part of the classic tradition of wine.desert2.jpg

It is possible to grow wine grapes at unexpected latitudes, but special conditions are necessary. In Arizona it is the desert at an altitude of about 4500 feet, where summertime highs are only in the 90s and the temperature at night can drop by 35 degrees. Altitude compensates for latitude. This advantageous diurnal variation along with lots of sunshine and rocky red soil are a good recipe for wine if you can add the right amount of water – not too little or too much.

Climate is not the problem I thought it would be and I think some of the wines we tasted displayed that mystical terroir that is the holy grail of wine critics. But climate change is a problem and that’s the unexpected story here. (I’ve written about climate change and wine in Chateau Al Gore.)

Kent Callaghan told me that the climate seemed to him to have changed significantly in the last 18 years. He reported recent crop yields of just a ton an acre for some varieties due to unfavorable weather. Some of the plantings of the classic varietals that showed promise earlier now seem misplaced so he has started slowly to change over to grape varieties that are able to produce consistent quality in the evolving environment.

This helps explain the use of California grapes for a few wines I tasted (to compensate for low Arizona yields) and the effective use of unexpected varietals (Tempranillo from Spain and Petit Verdot, a Bordeaux blending grape). Having learnt to make good wine in Arizona, winemakers like Callaghan have had to learn the process all over again with new varietals. In this regard I think they are perhaps ahead of the curve – winemakers all over the world will have to adjust to climate change in the decades ahead.

I understand that the Erath Arizona vineyard is being planted with many different varietals. It sounded to me like an experimental vineyard when I heard the list of plantings, but I think there is more than guesswork involved. I expect that Erath, Bostock and Callaghan and other talented winegrowers will figure out what Arizona’s terroir is meant to produce. It will be interesting to track Arizona’s progress and see how its wines fare in a world where the environmental givens are shifting and the market conditions becoming increasingly diverse and competitive.

Wine and Wine Tourism

The wineries I visited are all relatively small with limited distribution, so don’t expect to find these products at your local shop. Production is limited to a couple of thousand cases, even with the use of California grapes to fill in the gap left by low local yield, and sales are mostly cellar door. The winemakers I spoke with are beginning to develop wine clubs and internet sales facilities, but most of the product is sold face-to-face. Restaurant placements, if done well, can help build reputation, but there is not much money in it for a small winery. And output isn’t usually big enough to fill a distributor’s pipeline. All of this may change in the future, of course, but for the present it is a craft industry. The future of Arizona wine, at least in the short run, is local not global.

And that is not necessarily a bad thing because exploiting the local is an important strategy and it seems to me that Arizona has a good potential for wine tourism. The world will probably come to Arizona wine before the wine is produced in sufficient volume to venture out into global markets.

The country around Elgin and Sonoita is strikingly beautiful and closer to Tucson than Napa Valley is to San Francisco. It is already a desirable day-trip destination from Tucson because of its bicycling and horseback riding opportunities. All you need is wine (and food) to complete the deal. The wine is already there, as we learned, and the food, too, but the word hasn’t leaked out. That, I think, is about to change.

Note: Thanks to Michael, Nancy and Sue for their help with this report and to Joyce at Dos Cabezas and Tom Bostock and Kent Callaghan for taking time to talk with us.

Washington and Oregon Wines in London

There is a special tasting of Washington and Oregon wines in London today, held at the Institute of Contemporary Arts at 12 Carlton House Terrace. More than 190 wines from 40 Pacific Northwest wineries are being sampled. Marty Clubb of L’Ecole 41 in Walla Walla is leading an educational seminar about the Washington wines and Howard Rossback of Firesteed is doing the same for the Oregon products. The event is funded in part by a $200,000 federal trade grant. I believe it is the largest organized effort (so far) by Northwest winemakers to break into the European markets. It will be interesting to see if this seedling can grow to bear fruit.

Washington and Oregon are important winemaking regions, of course, but their reputations and sales are concentrated in the United States. Although Oregon Pinot Noirs are always included in the discussion when people anywhere talk or write about new world Pinots, the fact is that not much of it is sold abroad. Oregon wine sales in the UK and France were just over 2000 cases in 2006, for example, out of total production of 1.6 million cases. The word may be out around the world about Oregon wines, but wine distribution and sales haven’t followed — yet.

I don’t have figures for Washington wines, but I suspect that the situation is more or less the same. Washington makes excellent wines (better than Oregon wines, if you judge by the Wine Spectator and Wine Advocate ratings, where several Washington wines receive 95+ points), but so far Washington doesn’t seem to have that one distinctive wine that could establish an international reputation. The state is too varied, I think, in terms of climate and geography for that to happen. Washington is Riesling country, judging by volume of production, but it hasn’t yet established an international reputation with this wine (although it is trying to do so with the Riesling Rendezvous conference). A variety of reds do well here, including both the Bordeaux and Rhone varietals, but no signature style of wine has emerged as the champion. Marty Clubb is telling the people in London that Washington has the ideal climate for wine (that’s the official Washington wine theme), which may be true but doesn’t really define the product for confused international buyers.

Washington does have one advantage over Oregon in the export market: distribution muscle. The Washington wine industry features a few very large players that have the financial clout to potentially open up foreign distribution channels. Money is necessary; it isn’t easy to establish a brand abroad in this crowded market and margins on exports are necessarily lower than for domestic sales, at least at the beginning. I have read that export sales by small scale winemakers are “vanity” projects and there may be some truth to this. That doesn’t mean it’s not worth doing, however.

The Chateau Ste Michelle family of wines have penetrated some European markets. I was surprised to discover a large display of CSM wines in an upscale supermarket next to the train station in Riga, Latvia, for example. I haven’t been able to find out how the wines got there yet — my guess is that CSM’s deal to distribute Antinori wines in the U.S. may be reciprocated by Antinori in Europe but I don’t really know. Other Washington wines including Columbia, Covey Run and Hogue are part of the Constellation Brands portfolio, which may aid in their international distribution, too.

The London tasting isn’t the first effort to get Northwest wines attention in the UK. I remember being in London in about 1990 and walking into Fortnum and Mason only to be shanghaied by an excited clerk who was directing anyone she could to a lonely wine tasting display where they were sampling wines from Hogue Cellars of Yakima. Needless to say, no one had any idea where Yakima was located, but they were amazed that such a unlikely place could produce good wine. Today’s London event is a much larger project than that Fortnum display, but the goal is much the same, to make friends, establish relationships, and get our foot in the door.

I hope the London tasting goes well. Many of the wineries are apparently looking for UK distribution, which makes sense. The UK is the most important wine market in the world. It is a good market to sell wine and to establish a worldwide reputation. A disproportionate number of the world’s leading wine writers and experts are based in London, including Jancis Robinson, Oz Clark, Michael Broadbent and Steven Spurrier. A good word by any of these celebrity wine critics would encourage wine enthusiasts in the UK and around the world to give Northwest wines a try. But the real prize would be a distribution deal with Tesco or Sainsbury’s, which dominate supermarket sales, or one of the big high street wine store chains, since you can’t try wines you can’t buy.

One reason this is a good time to try to break into the UK and European markets is that the exchange rates favor U.S. exports. The dollar fell dramatically in 2007 against both the Pound and the Euro, making U.S. wines relatively less expensive. This will help, but it will still be difficult to get British wine drinkers to think beyond Gallo and one end of the market and Napa Valley at the other.

It’s tough to break into foreign wine markets. Ernie Hunter famously did it the DIY way — he brought his wines to London and entered them in the Sunday Times wine festival, where they won the people’s choice award. Ernie was from New Zealand and his surprise victory paved the road for Marlborough Sauvignon Blanc’s dramatic rise in the world of wine. Washington and Oregon are taking a direct and organized approach, with tastings and seminars. Every case is different. My next post will tell an unlikely story of how Washington wines first came to Sweden.

What’s Red and White and Green All Over?

The answer, of course, is wine.

Perhaps the most interesting trend that I have observed in wine this year is the growth of green wine. By green I mean wine that is made and marketed with attention to the environment (although vinho verde from Portugal can claim to be a green wine on other counts).

What drew my attention to the green wine movement was not the existence of organic wines — they’ve been around for a long time — but the variety of ways that winemakers are embracing sustainability and the environment as an integral part of their work.

I uncovered three sustainability initiatives while doing fieldwork in Oregon, for example. The first was the Low Input Viticulture and Enology initiative, or LIVE for short. This is an a voluntary program with about 70 certified members that, according to the website, aims …


  • To see the vineyard as a whole system
  • To create and maintain a high level quality fruit production
  • To implement practices that reduce reliance on synthetic chemicals and fertilizers with the goal of protecting the farmer, the environment, and communities at large
  • To encourage responsible stewardship of the land, maintain natural fertility and ecosystem stability
  • To promote sustainable farming practices that maintain biological diversity in the whole farm

  • I haven’t studied the LIVE program closely, but my impression is that it is an attempt to both promote sustainable vineyard practices and, at the same time, take local control of the certification process. Why create an organization like LIVE — why not just go “organic” and be certified organic? I have talked to a number of winegrowers who hesitate to seek organic certification because of the considerable expense and also because the sort of sustainable viticulture they seek to practice goes beyond the avoidance of chemicals. Regional initiatives like LIVE allow groups of growers to define sustainability in a way that is compatible with local conditions and practices and to retain local control of the process.

    Some winemakers are going all the way when it comes to sustainability, which is what the biodynamic wine movement is all about. Biodynamic winemaking is based upon a set of agricultural theories that the Austrian philosopher Rudolf Steiner proposed in the 1920s. The biodynamic idea is to treat the entire vineyard as a living organism and to adopt practices that promote the health of the entire structure — vines, soil, insects, and so forth. This reminds me of the famous Gaia Hypothesis that the whole earth is a living organism.

    Most biodynamic practices are uncontroversial, but the use of special organic field sprays draws special attention. The sprays are made by burying cow horns full of cow manure or ground quartz in the vineyard for six months and then spraying the estate with the resulting composted product in diluted form at specific times of the day and phases of the moon. The idea is to promote microbial health and the balanced growth of the vineyard. It sounds a little like voodoo viticulture, to me, but there are plenty of good winemakers who have adopted this practice so I am going to keep my skepticism in check for now.

    Several Oregon winemakers including Brick House and Cooper Mountain have gone or are going biodynamic. They join California producers including Frog’s Leap, DeLoach and Benzinger and a growing number of winemakers in Europe and around the world. I understand that many winemakers in Chile such as Emiliana Orgánico are adopting biodynamic practices, for example, both on philosophical grounds and, I suspect, in an attempt to differentiate their wines in the marketplace. (Click here to read Emiliana’s explanation of the principles of biodynamic viticulture). I haven’t tasted enough biodynamic wine to have an opinion about how the process affects the end product.

    The final example from Oregon is the Carlton Winemakers’ Studio, a facility that about a dozen smaller winemakers share. This operation was designed to meet recognized environmental standards from the group up. According to the website it was …


    The first winery registerd with the US Green Building Council, The Carlton Winemakers Studio was designed to be compliant with LEED (Leadership in Energy and Environmental Design) certification, promoting a whole – building approach to sustainability by recognizing five key areas of human and environmental health: sustainable site development, water savings, energy efficiency, materials selection, and indoor environmental quality.

    Some of the most intriguing environmental building materials and techniques are the following:

    • Below foundation water capture and reuse
    • North roof water capture and reuse
    • Clear roofing materials
    • Daylighting, windows, doors, and hallway
    • Night air cooling
    • Coal byproduct (fly-ash)/concrete mix
    • Recycled mats, paint, office desk materials, roofing metal, carpet
    • Non-conventional material uses: sals-walls, curtains, shade
    • Reused: counter tops (SS & acid resistant composite), light, concrete, sinks
    • Dynamic flow air pocket walls
    • Earth berm / below grade walls for natural cooling

    The Winemakers Studio’s strategy suggests that green wine can be good wine, good economics and good for the environment.

    Sustainability is obviously important in winemaking, but it doesn’t end there. A growing number of wine brands, such as French Rabbit, are embracing sustainability in wine packaging and transport. Here’s how Boisset America, the French firm that makes and markets French Rabbit (and owns biodynamic DeLoach) got into the sustainable packaging business.

    Canada is a good market for wines, especially French wines, and the Liquor Control Board of Ontario is therefore a big buyer with lots of market power. As a state monopoly, the LCBO sets economic, social and environmental goals for its operations. They aim to minimize energy use and maximize recycling. LCBO challenged their wine suppliers to introduce new products to promote these goals and French Rabbit was one result. As Patrick Egan, brand manager for French Rabbit, notes

    “Our real immense success was with Liquor Control Board of Ontario. They inspired the creation of French Rabbit. As a goverment entity they were interested in challenging themselves and their suppliers to reduce packaging waste. They set an ambitious goal of eliminating 10 million kilograms of packaging waste per year. There were no other wines yet available in Tetra Paks when we presented French Rabbit, and they immediately embraced the concept. FR was the most successful launch of a new brand they’ve ever had, and spawned more than 75 other wines in Tetra Pak packages since French rabbit was launched there in July 2005. The success helped the LCBO reach their packaging reduction goal some 2 years ahead of schedule. Here in the US, there are really 3 primary brands [in Tetra Paks] so far, with more on their way.

    “Turns out, much of the world has been consuming wine from the Tetra Pak package for many years (you must have seen Tavernello on your travels to Italy). Our angle, our raison d’etre, for introducing a new wine in this package to North America has been the ecological benefits to the package. In the age of global warming and increasing interest in sustainability, our package has the benefits of the lowest carbon output per unit of wine sold when the full life cycle of the package is considered. Its lightweight and minimal packaging materials mean immense savings when compared to the glass bottle. So, as wineries make more and more efforts to combat global warming in the vineyards and in their energy consumption, we’ve gone the angle of actually transforming the package that wine is delivered in to consumers. Just as globalization increases choice for consumers, it also means more and more wine is shipped all over the world. Ours dramatically reduces the impact when wine is shipped, in addition to the savings generated when the package is produced and the package is recycled.”

    It seems to me that the wine industry is ahead of the curve with respect to sustainability and the environment. Wine is a product of nature, after all, and there are special reasons, aesthetic, philosophical and economic, why winemakers should wish to emphasize that connection. Green wine, I predict, is here to stay.

    Old World meets New World in Oregon

    The debate about wine is often framed as Old World (Europe) versus New World (California, Australia, New Zealand, South Africa, South America) but I am suspicious of such simple dichotomies. I suspect that the issues don’t break cleanly along these lines, so I always find it interesting to explore the blurry edges where Old meets New to see what I can learn.

    The film Mondovino examined l’affaire Mondavi – Robert Mondavi’s unsuccessful attempt to build a winery in the south of France. That’s a pretty easy (is oversimplified) story to tell: Americanization, McDonaldization, Disneyfication. You know what I mean.

    I’m interested in the reverse flow, Old World winemakers who invest in the New World, how and why do they do it and what are the results? Sometimes Old World firms enter into partnerships with New World winemakers. Opus One is probably the most famous such venture, a partnership between Robert Mondavi and the Rothschild family of France. Col Solare is another good example, an alliance Ste. Michelle Wine Estates of Washington and the Italian Antinori family.

    Direct investment is another strategy – Old World wineries buy land, plant vineyards, build wineries, bring in their winemakers, and make wine. What kind of wine? Old World wine in the New World? New World wine? That’s a question worth exploring.

    Some examples of Old World winery investment in the New World include the Domaine Chandon in California (owned by the French Champagne house), Barboursville winery in Virginia (owned by the Italian Zonin family), the St. Supery winery in Napa Valley (owned by the French Skalli family) and Domaine Drouhin Oregon (DDO), which is owned by the French Joseph Drouhin firm. I visited DDO recently, accompanied by my wife Sue (photo right) and our friends Michael and Nancy Morrell (photo left below), who are sailors (they have circumnavigated the globe in their Norseman 447) and aspiring wine research assistants. Here’s what we learned.

    Maison Joseph Drouhin is a famous Burgundian winemaking firm. They began as negociants in the 1880s, aging, blending and marketing wine made by others and eventually acquired some exceptional vineyards of their own. Oregon appeared on their radar nearly 30 years ago when Robert Drouhin presided over a blind tasting of Old and New World Pinot Noirs in 1979, which was won, to everyone’s great surprise, by an Oregon wine from Eyrie Vineyards. What followed is a long story that involved many visits to Oregon. Robert’s daughter Véronique, who was studying winemaking at Dijon, interned at several Oregon wineries. Having learned all they could, the Drouhins took the big step, bought land, planted vines, built a winery, and began making wine. The first vintage, 1988, was made in a rented facility using purchased grapes. The gravity-flow winery (the first such in Oregon) was built in 1989. Today they have 90 acres of densely-planted vines (one meter by one meter by the look of them) on a 225 acre estate. Véronique is the winemaker and her brother Philippe manages the vineyards here as well as those in France. The wines? The classic Burgundian varieties, Pinot Noir and a little Chardonnay.

    Mark Bosko, the DDO tasting room manager pictured here, spent almost two hours with us, showing us the vineyards and production facility and answering all manner of questions. The tour ended with a comparative tasting of Drouhin’s French and Oregon wines. To be specific, we compared the 2005 Maison Joseph Drouhin (MJD) Chablis Premier Cru ($27) with the 2006 DDO Chardonnay Arthur ($30) and a 2004 MJD Beaune Premier Cru ($28) with the 2005 DDO Pinot Noir Willamette Valley ($45). We are not professional tasters, but we did have opinions. The group seemed to favor the Oregon Chardonnay over the French Chablis. I suspect that this is because we are more familiar with the oaked Oregon style than the more mineral classic Chablis flavor. It would be interesting to taste these two wines with consumers from France — I am sure they would make the opposite choice! It was easy to tell Old World from New World here.

    We liked the French Pinot Noir better, although I am not sure if it was a completely fair comparison. I think the French wine benefited from its additional year of aging. I would like to taste the DDO again in a year to see how it has matured.

    So what kind of wines are the Drouhins making in Oregon? I would say that they have some of the style of the French wines that we tasted (a family resemblance, as Mark suggested?), but they are still quite different – and this is not a surprise. Although the grape varieties are the same as are the barrels and the vineyard manager, almost everything else is different, especially the climate and the soil. If terroir matters, the wines should not be same. And the market is different, too, which makes a difference.

    How do other Oregon winemakers view DDO? On one hand, I think that DDO’s investment here has given Oregon Pinot Noir credibility that would otherwise be difficult to achieve and so it has benefited the entire industry here. I think that some of the pioneer winemakers probably worked pretty hard to encourage Robert Drouhin make this investment for exactly this reason. On the other hand, of course, DDO is big-bucks, deep pocket competition for the many smaller winemakers in the valley, so you can imagine that there is some envy and even resentment of their success. But this isn’t an attitude unique to wine when it comes to direct foreign investment.

    Can Small Winemakers Survive?

    Can small winemakers compete in a wine market that is increasingly dominated by large producers and experiencing rapid consolidation? This is one of the questions I was asking in my recent trip to Oregon, where I visited several wineries in the Willamette Valley. Here’s what I found out.

    Economies of scale in distribution do matter and so the consolidation trend is real, even in Oregon. The Erath winery, one of Oregon’s real pioneers dating back to 1972, was purchased last year by St. Michelle Wine Estates, the Washington wine giant that produces Chateau St. Michelle and Columbia Crest and that also now owns boutique Spring Valley vineyard in Walla Walla.

    On the other hand, Oregon is still benefiting from the Sideways phenomenon, which has created a surge in demand for Pinot Noir, its signature wine. Some small high quality pinot-noir specialists sell out through their wine clubs or at the cellar door and are thus immune, for the time being, from distribution woes. The Pinot fad, if that’s what it is, benefits Oregon wineries and has allowed them to expand production and raise price at the same time that other winemaking areas have been in retreat. I saw many new blocks being planted in Oregon to take advantage of high demand and rising prices. It will be interesting to see what happens in a few years, when all of these vineyards begin producing. Will demand remain high? Will the supply be too great? All bets are off for small winemakers (at least those without very deep pockets – and there are some of these in Oregon) if a Pinot glut should appear.

    How can small wineries compete? Wine cooperatives are one solution, although not necessarily a good one. Wine cooperatives are big business in Europe, especially France and Italy. A number of smaller vineyard owners jointly own a winemaking facility, delivering their grapes to be blended together. I have tasted some wonderful cooperative-made wine in Alto-Adige (Northern Italy), but I think this was the exception. Cooperative wines are suspect because the members are paid on the quantity of grapes they deliver to the winery rather than the quality of fruit they produce. No one has an incentive to sacrifice quantity to improve quality and the resulting wines can be hard to drink and harder to sell. They form much of the “wine lake” that the European Union is trying to eliminate.

    In economic terms, the idea of sharing expensive fixed-cost facilities is sound, but the cooperative institutional structure is problematic. The Carlton Winemakers Studio (CWS) in Carlton, Oregon (in the new Yamhill-Carlton District AVA) is an attempt to get the benefits of cooperation without the negative incentive effects. I visited CWS recently and met with Jeff Lumpkin, the general manager, who is pictured here.

    CWS is a 20,000 case facility that provides services to 11 individual tenant wineries (including Lazy River, Jeff’s own label). The costs of the expensive structures and equipment are shared, but each winemaker is independent and has complete control of wine production, so each has an incentive to make excellent wine. Quality rules. You can taste all of the wines in CWS’s attractive tasting room.

    We were fortunate to be able to attend a wine dinner at CWS to celebrate the release of the new J.Daan Syrah (made with Columbia Valley grapes). It is a good example of what is possible at CWS. Winemaker Justin Van Zanten (pictured here with his wife Megan) makes about 600 cases of J.Daan a year at CWS, mostly Pinot Noir. His “day job” is assistant winemaker for Andrew Rich, which is also a CWS tenant. The CWS facility has helped him get a foothold in the industry and to gain some attention for his wines (Wine Advocate rated his 2003 Pinot Noir a 90). I bought the 2005 Pinot Noir for $27, a bargain price for Oregon wine of this quality.

    The CWS formula clearly has benefits for small winemakers and has been successful, as far as I could tell, in achieving its goals. Jeff Lumpkin was nice enough to guide us through a tasting of a half dozen CWS-client wines and the quality is certainly there.

    Is CWS a success story? Yes, I think so. But the future of this facility and the institutional model it represents is still uncertain. For one thing, it seems to be straining and the seams to accommodate the rising production of its client winemakers – will there still be a place for the small winemakers? – and I don’t think anyone knows for sure what the market for Oregon wines will look like in five years. Will bust follow boom?

    And then there is the incentive problem. Although a fee-based private property rights operation like CWS avoids the negative incentive structure of the French cooperatives, there is still a natural incentive for winemakers to try to free-ride on services and facilities if they can. With luck, market conditions and private incentives will align themselves so that CWS’s excellent winemakers will continue to prosper.

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