Monthly Archives: November 2010

Retail Wine Sales: Big versus Hot (Hot Hot)

November 30, 2010 By in Argentina, Australian wine, Constellation Brands, Gallo, New Zealand, Supply and Demand, wine markets, wine price, Yellow Tail 18 Comments


I thought it would be interesting to take a look at what’s “big” in the wine market (where the most consumer dollars are going) versus what’s  “hot” (or “hot hot hot” as in the video above), showing the fastest growth.  I’m using U.S. off-premises wine sales data from Nielsen for the 52 weeks ending 9/18/2010 taken from the December 2010 issue of Wine Business Monthly.

Baseline information: Off-premises wine sales in the U.S. totaled $9,172 million in the period covered here according to the Nielsen report, with an overall growth rate of 3.2%.

Which product categories are the largest in absolute terms and which are growing the fastest? I’m going to break down the data by wine varietal, country of origin (for imported wines) and price category. Take a minute and write down what wines/countries/price points you think will be at the top in each category and see if you’re right. Here goes

Chardonnay Leads the Way

Forget what you thought you knew about Chardonnay being so yesterday and Pinot Noir kicking Merlot’s butt. In terms of the overall retail market sales, the giants (or are they dinosaurs?) still dominate.

BIG varietals

Varietal $ million
Chardonnay $1,996
Cabernet Sauvignon $1,347
Merlot $911
Pinot Gris/Grigio $734
Pinot Noir $526
White Zinfandel $427

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American wine drinkers are nothing if not traditional, reaching again and again for familiar varietals, so the usual suspects come top of the table. Pinot Noir has indeed surged in the post-Sideways era, but its lead over wounded White Zin is not large and it still lags far behind arch nemesis Merlot.

Obvious Chardonnay is the consumer default with a 50% lead on Cabernet and double the sales of Merlot. Pinot Grigio, the #2 white varietal, lags far behind.

I find the varietal “hot list” below quite interesting. The fastest growing wine varietals  are Riesling, Pinot Noir (of course), Sangiovese and Sauvignon Blanc. (Interestingly, varietal Sangiovese is rising while Chianti is a shrinking category in the Nielsen league table.)

HOT varietals

Varietal Increase
Riesling 9.4%
Pinot Noir 8.9%
Sangiovese 8.7%
Sauvignon Blanc 8.5%

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It seems to me that while the “big” varietals are wines that many consumers purchase to drink on their own (because of their high alcohol levels and for other reasons), the “hot varietals” are a bit more likely to be food wines. I wonder if that’s a trend?

World Wine Web

Most of the table wines that Americans drink are American — there is a very strong home country preference. Domestic wine sales totaled $6,524 million for the period covered here while imports accounted for $2,648 million. What countries supply the most imported wine as measured by total expenditures? Here’s the Big list:

BIG import countries

Country of Origin $ million
Italy $804
Australia $771
Chile $243
France $228
Argentina $187
New Zealand $125

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As the table shows, Italy and Australia are #1 and #2 respectively in off-premises sales. It is interesting that France has fallen to #4 behind Chile. Argentina and New Zealand make the cut here (Spain did not!) as you might expect, but bear in mind that Italy still sells more wine in the U.S. than Chile, France, Argentina and the Kiwis combined. The concentration ratio in this market is very high: Italy and Australia may be struggling at the moment, but they are in a league of their own.

Italy and Australia will not be over-taken soon, but the market momentum seems to have has passed. Look at the big growth numbers that Argentina and New Zealand are putting up below! Wow. Annual growth rates of more than 20%!

HOT import countries

Country of Origin Increase
Argentina 27.6%
New Zealand 21.1%
Germany 4.4%
Chile 1.7%
Spain 0.6%
Portugal 0.3%

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Now look at the gap between the really hot ones and the rest! Germany comes in at #3 on hot list, but with a low 4.4% increase for the year. Sales of most wine imports (including Italy and Australia) have actually fallen in the last year. Spain and Portugal squeeze onto the list at #5 and #6 by simply avoiding utter collapse. The import wine segment is slumping badly, with Argentina and New Zealand the only significant exceptions.

The Price is Right

Finally, let’s look at the market in terms of price points.  What are the biggest and hottest parts of the wine wall in terms of price?

BIG price points

Price Segment $ million
$3.00 – $5.99 $2,688
$6.00 – $8.99 $1,903
$9.00 – $11.99 $1,868
$12.00 – $14.99 $910
$0 – $2.99 $794
$15.00 – $19.99 $557
$20+ $446

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You can see from the data why Gallo is having a good year (or probably having a good year, since they are a private company and don’t release data so I can only guess). Their brand portfolio is aimed at the heart of the market, from $3.00 to $11.99. Lots of good targets there!

You can also see why Constellation Brands is probably finding this a challenging year. They reconfigured their brand portfolio to take advantage of what they saw as upmarket opportunities.  They moved up the wine wall a bit but the market changed directions and went downmarket, leaving them in a less competitive position.

HOT price points

Price segment Increase
$9.00 – $11.99 9.1%
$20+ 7.4%
$12.00 – $14.99 5.0%
$3.00 – $5.99 4.5%
$15.00 – $19.99 2.5%
$0 – $2.99 (0.1)%
$6.00 – $8.99 (4.0)%

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But Constellation’s upmarket bet may yet pay off. The hot price segments are all in the wine wall’s upper strata.

The Old Elasticity Trap

The rise in spending in the super-premium + categories is an encouraging sign, but I think some caution is necessary in interpreting the data. Many observers see the big increase in expenditures on $20+ wines and conclude that consumers are coming back to this segment strongly — that the demand curve has shifted. But I suspect that there is a lot of bargain hunting taking place and that margins are falling – bad news. Maybe we are just following discounted prices down the demand curve.

For many of today’s buyers a $20+ retail wine is a highly discretionary purchase and so the demand curve may be quite elastic. Econ 101 students will remember that total expenditure increases when price falls for a product with an elastic demand.

The large percentage expenditure increases we seen in the data could result from discounting — $30 wines being sold off for $25 and so on — rather than an actual increase in demand or shift in the demand curve.  The increased revenues are good and inspire optimism, but they may disguise the bad news of shrinking margins.

(As I am writing this, the neighborhood Safeway is offering an extra 20% off any wine selling for $20 or more. I suspect sales revenue will increase at the lower retail markup.)

Overall conclusions? I’d rather not, thanks. These data are interesting more for the questions they raise than the answers they provide. But the questions about how the U.S. wine market is changing are worth pondering (hopefully over a nice glass of wine). Cheers.

On the Oregon [Terroir] Trail

November 23, 2010 By in AVAs, Oregon wine, wine markets 6 Comments

Don’t know how I missed the big news. The folks in Oregon’s Yamhill-Carlton District AVA have been successful in their petition to change the appellation’s name. Henceforth they’ll be known as Yamhill-Carlton not Yamhill-Carlton District.  Wow, I’m glad they finally got that fixed! “District” was redundant, according to one report, and the name was said to be too long to fit on a wine label.

Oregon winemakers are a bit intoxicated with appellations, so I suppose they can be forgiven for being so particular about them.  Oregon imagines that it is Burgundy West (not without some justification) and longs for the fine grid of appellation and vineyard designations that Burgundy is famous for.

Never Satisfied

Not satisfied with the Willamette Valley AVA and six sub-AVAs, many Oregon winemakers have taken the Burgundy-inspired next step, releasing portfolios of vineyard designated wines.  While I admire their efforts to deeply mine their terroir, I am a bit concerned that they might also be undermining the regional brand.

The idea of Oregon wine is not necessarily an easy one for many consumers outside the region to get their heads around. Adding a couple of layers of complexity seems like it could make the big sell even harder. Fortunately, as Paul Gregutt noted in a Decanter article a couple of years ago, particular AVA names are essentially meaningless to many buyers, invisible to all but the most ardent enthusiast, so perhaps I am misoverestimating the confusion factor.

Even so, there are two concerns. First, if everyone is looking after their own little patch of dirt, who’s paying attention to the bigger “Willamette Valley” regional brand? I do think this is a serious issue because regional reputation is hard to earn and easy to lose.

I was shocked a year ago when I saw my first sub-$10 Oregon Pinot Noir, but that sticker shock has passed.  Willamette Valley Pinots in that $10 range are a common sight now and I have seen prices as low as $5.99. Yikes!

The Oregon industry with its low yields and high costs can’t afford to be defined as a “value” region and the marketplace seems to be going in that direction. Maybe, as some have suggested, it’s time to look up and consider the big picture in Oregon.

So is the focus on micro-terroir misguided when these bigger problems loom? Well, not necessarily if there’s really a there there. (Did that make any sense? Let me try again.) Not if the fine geographical divisions are valid and the wines made therein are truly distinctive. But are they?

Target: Archery Summit

With this question in mind we went in search of clear evidence of Oregon terroir. Our target: Archery Summit, chosen because they are owned by the same corporate parents as Napa’s Pine Ridge, which I examined in my Stags Leap District project, and because of their terroir-driven focus on single-vineyard bottlings from distinctly different parts of the valley.

Was there a there there? Well, yes, even I could taste it (and I don’t claim to have a particularly  educated palate), especially the Looney Vineyard wine. Of course Archery Summit has resources unavailable to many others to vigorously pursue terroir. It may therefore be a mistake to generalize from this one winery or others with the same intense focus (Ken Wright Cellars, for example), but it is clear to me that those Bugundian dreams are not wholly unfounded.

One wine that we tasted, made when Archery Summit (and Pine Ridge) founder Gary Andrus was still in charge, was sort of an über-terroirist experience. The 1996 Chêne d’Oregon Pinot Noir was actually aged in barrels made from an oak tree that grew on the vineyard site. As the Archery Summit website explains …

Creating a distinctively ‘Oregon’ Cuvée originated with a desire to marry the taste of Oregonian Pinot Noir and native Oregon oak. Our French cooper François Frères crafted six barrels of Quercus garryana Oregon white oak for the inauguration of Chêne D’Oregon. This Pinot Noir blend aged in 100% new Oregon oak barrels displays the true embodiment of Oregon’s forests, vineyards and soils.

Terroir squared. Very intense. Not to everyone’s taste (maybe this much terroir is too much?) but very interesting nonetheless. Quite an experience!

Rational Exuberance

Oregon winemakers can be forgiven for not caring one iota about my concerns about their AVA structures (or why Stags Leap District fits on a wine label while Yamhill-Carlton District apparently does not). The reviews are just in for their 2008 wines and the scores and comments are fantastic.

One wine broke through Wine Advocate‘s long impenetrable (by Oregon) 95 point ceiling. The Shea Wine Cellars 2008 “Homer” received a 96-point rating (the highest I have seen in WA for an Oregon Pinot) and the Antica Terra “Bontanica” was rated 95.  These great wines and their rave reviews (not just the big numbers)  give the whole Oregon industry the recognition it has long sought.

2008 may be the best vintage in Oregon’s relatively brief  history, according to Wine Advocate critic Dr. Jay Miller. A good thing, too, since it comes after the problematic 2007 wines, many of which are still awaiting buyers. Vintage matters in Oregon, just as it does in Burgundy where the weather is famously variable from year to year.

I’m still concerned about the future of the region if supply and demand cannot be brought into better balance so that economically sustainable prices reappear. (Even Pine Ridge, Archery Summit’s parent, has responded to the soft market by releasing a $20 value brand called Forefront. No idea where the grapes might have come from …).

In the meantime, however, maybe it is best to simply appreciate what Nature has provided. Open up a bottle of ’08 Oregon Pinot and enjoy. Happy Thanksgiving!

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Thanks to Chris Hayes for showing us around Archery Summit and helping us dig into its terroir.

A Wine Economist First?

November 18, 2010 By in Shameless Self-Promotion 17 Comments

I guess I should file this post under “shameless self promotion.”

Just wanted to share the good news. Many of you know about my “day job” as a professor at the University of Puget Sound in Tacoma, Washington. This week I was named “Professor of the Year” for Washington by the Council for the Advancement and Support of Education and the Carnegie Foundation for the Advancement of Teaching.

I think I may be the first wine economist to receive this award!

I’d like to share this honor with my current and former students, my colleagues at the University of Puget Sound and most of all my teachers and professors who were such wonderful role models for me. I feel like I’m getting credit for the work all these folks have done over the years, so I’d like to turn the spotlight back on them!

Teaching is a lot like wine-making. Education and wine are relationship businesses. Both require big investments that take years to bear fruit.  And each vintage is different, so the challenge never disappears.  When all the pieces come together, the result is, well,  magical.

Here’s the official press release:

Mike Veseth Named Professor of the Year for Washington State

University of Puget Sound is Top in the State for Receiving the Award

TACOMA, Wash. – In his office Mike Veseth keeps a large bucket of vividly-colored juggling balls.  “I started juggling, because I didn’t want to forget what it is like to do something for the first time and to have to struggle to get it right,” the University of Puget Sound professor says.

After 35 years of teaching and developing what a colleague describes as “an unbelievable mastery” of his academic field, Veseth did not want to lose touch with the inevitable frustrations of being a student. And so he juggles—badly by his own account—and learns how to learn, so he can pass along a passion for learning to his students.

This is how Mike Veseth, the Robert G. Albertson Professor of International Political Economy, came to be honored with the prestigious 2010 Washington State Professor of the Year award, sponsored by the Council for the Advancement and Support of Education and the Carnegie Foundation for the Advancement of Teaching. Veseth will attend a Washington, D.C., award ceremony on Thursday, Nov. 18. He is the sixth Puget Sound professor to secure the title, making the college the foremost recipient of the award in Washington state.

“Mike changed my life,” wrote more than one former student in testimonies. “I was a prickly, argumentative, and contrary student,” wrote Kirsten Benites ’03, from London. “Regardless of whether he personally believed my arguments, he taught me how to defend my position in a logical way.”  Theater artist Seema Sueko ’94 said that, at first, the professor’s notoriety “intimidated me.” But once Veseth offered the shy student guidance and opportunities, he “transformed me, gave me a voice … and laid the foundation for me to excel.”

Veseth became an excellent teacher by remaining forever a student. He learned what methods of teaching resonated with his students and adopted them. When a changing world demanded a new class, he created it; when the class required interdisciplinary knowledge, he recruited the faculty for it; when a textbook did not exist, he co-wrote it; when the text was adopted by 100 other colleges, he and his colleagues used the funds to support student research.

Urban legends trail Veseth. In earlier days he put elements of the economy’s national income accounts to verse, provided keyboard music, and encouraged students to dance the “gross domestic  polka,” while the class sang along. He currently teaches a class called The Beautiful Game where students study racism, sexism, class conflict, nationalism, commercialization, and globalization through soccer. There is always a long waiting list for his course on The Idea of Wine, which examines the cultural contradictions of post-industrial society using a wine glass as its lens. For seniors preparing to tackle their first thesis, Veseth prescribes a session of juggling the infamous colored balls, so that the students are armed with the humility and determination needed for the uphill climb.

A colleague has remarked on the number of students who pass in and out of Veseth’s office. “I try to get to know the students’ personal interests,” Veseth explains. “So even if it’s an abstract subject, I can find a link that relates to something they care about.”

Veseth demands the best, and his students respond. Aaron Ausland ’96 writes about “miserably throwing away” a graduate school application essay after being told by Veseth it was “not his best work.” The revised essay gained Ausland admission to Harvard Kennedy School, where he wrote an award-winning master’s thesis that propelled him to his current position at the global anti-poverty agency, World Vision.

“I sit here with a pile of letters received from Kathmandu to London, from members of Classes of 1993 through 2011,” wrote Kristine Bartanen, Puget Sound academic vice president and dean, in her letter of nomination. “All of them found the inspiration for actualizing their lives of service to the global community as a student in Mike’s classroom. You can see that being an outstanding teacher is not just what Mike does, it’s who he is.”

Michael Veseth, co-founder of the first undergraduate program in international political economy, has written, edited, and co-authored more than a dozen books including Mountains of Debt; Globaloney (named a Library Journal best business book of 2005); Globaloney 2.0: The Crash of 2008, and the Future of Globalization; and Wine Wars (forthcoming 2011). A Puget Sound professor since 1975, Veseth has held visiting posts with the American Institute on Political and Economic Systems in Prague and Johns Hopkins University’s The Paul H. Nitze School of Advanced International Studies in Bologna, Italy. He is a graduate of Lincoln High School in Tacoma, Wash., and earned undergraduate and graduate degrees from University of Puget Sound and Purdue University.

CASE and the Carnegie Foundation have been partners in offering the U.S. Professors of the Year awards program since 1981. TIAA-CREF, a leading financial services organization, is the principal sponsor for the awards luncheon. Additional support is received from a number of higher education associations, including Phi Beta Kappa, which sponsors an evening congressional reception.

The U.S. Professors of the Year program salutes the most outstanding undergraduate instructors in the country—those who excel as teachers and influence the lives and careers of their students. Nominees for the award are selected by their own institution and are judged by two separate panels of education experts and professionals on the basis of criteria including their impact on students, scholarly approach to teaching, and contribution to education in the institution, community, and profession.

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The photo is by Drew Perine, taken from The News Tribune story by Rob Carson.

Past is Prologue at Tantalus Vineyards

November 14, 2010 By in Canada, history, wine markets Leave a comment

Past is prologue, Shakespeare wrote in The Tempest, and I’ve learned that if I want to figure out  the future I first need to understand the past. That’s why we decided to visit Tantalus Vineyards on Dehart Road southeast of Kelowna, British Columbia. My investigation of the future of Canadian wine had to start at its roots.

Jane Hatch (that’s her in the video) and David Patterson showed us around the contemporary winery and hospitality facility that  opened just a few months ago (the video was made while it was still under construction).  Jane is the winery’s general manager and David its production winemaker.

Past, Present and Future

Looking down over the vineyards to the lake from the new LEED certified building with its First Nations mask decorations, it would have been easy to forget the past and just enjoy the present. But Tantalus is a place where past, present and future come together.

J.W. Hughes bought land here in 1927 and planted his Pioneer Vineyard to vitis lambrusca varietals (think Concord grapes and the like), to be sold on the table grape market. In 1930 he agreed to sell grapes to Victoria Wineries Ltd. (for $100 a ton) in what may be the first wine grape contract in Canadian history.  Commercial B.C. wine production up to that point was focused on fruit wines – loganberry wines at Victoria and apple wines at nearby Calona Wines Ltd, for example. It was a good way to use up surplus fruit.  There is no indication that the wines were of particularly high quality. Consumer expectations for wine were low and these products found buyers.

Hughes expanded his vineyard holdings and then, starting in the mid-1940s, began to sell them off to his farm managers. That’s how Martin Dulik came to own Pioneer Vineyards, which he paid for over seven years beginning in 1944 by giving Hughes half of the revenues from each harvest.

Dulik, a Czech immigrant, managed the vineyard well and the grapes that he and his son Den produced were sold on both the wine and table grape markets. As wine production in the region expanded in the 1960s, many growers replanted to French hybrid varietals like Seyval Blanc, but Den Dulik resisted the trend, reasoning that his vitis labrusca grapes made better wine than the hybrids. He was probably right, although the wines they were went into were often the unsophisticated “pop” products that were popular at the time.

Taking the Next Step

In 1978 Dulik was persuaded to plant White Riesling and these vines are the foundation of Tantalus Old Vines Riesling that I tasted on my visit. Soon Pinot Noir, Chardonnay and other vitis vinifera vines joined Riesling in Pioneer Vineyards.

Everything was in place, therefore, when Den’s daughter Susan developed a passion for wine and started making wine with the family fruit. Her project soon developed into a farmgate winery called Pinot Reach conceived with the intention of making exceptional Pinot Noir. Pinot Reach opened in 1997. Its wines, especially the  Old Vines Riesling, were soon being praised by no less than Jancis Robinson, the celebrated British wine critic.

Investor-enthusiasts Eric Savics and Eira Thomas bought the winery and vineyards from the Duliks in 2004, renaming the operation Tantalus,  and began the transformation that includes the new winery facility you’ll find there today. Tantalus’s recent development reflects two trends that I saw everywhere on our Okanagan wine tour.

Global Meets Local

The first is a growing international influence. Although the market for these wines is mainly local, the winemaking influences are decidedly global. Tantalus’s senior winemaking consultant, Jacqueline Kemp, is a New Zealand “flying winemaker,” who brings international experience to her work here. Production winemaker David Patterson is Canada-born, but he learned winemaking  in New Zealand and earned his winemaking spurs there and in Oregon and Australia.

All across the region I met winemakers and “flying interns” from around the world. In a way this continues an existing pattern, since many of the early winemakers here were immigrants who brought winemaking knowledge with them, but it is more than that. The Okanagan is now clearly part of a very intense global exchange of technical winemaking knowledge.

Talking with David about the great strides that the region’s wines have made, I brought up climate change. Surely the changing natural environment accounts for the improvement, I suggested. David disagreed. It was better winemaking, not warmer weather, that made the difference he said, and surely the international influences are part of that.

The second trend, which is seen so clearly at Tantalus, is that this global energy is clearly focused on identifying distinct local terroirs. The Tantalus team realize that theirs is an exceptional location for Riesling and Pinot Noir and they are drilling down into those vineyards and particular varietals to see what they will reveal.

The region is extremely varied in its micro-terroirs – almost anything is possible here from ice wine to Syrah and Zinfandel. But just because something can be done doesn’t mean you should do it and the race is on to find out what works best for each vineyard block.  Focus and increasing specialization are the wave of the future here.

Yes and No

So is past prologue?  Yes and no. Yes in the sense that the Okanagan wine industry wouldn’t be what it is today without the evolutionary process it’s experienced. The industry is stronger for the work of its pioneers and the legacy they created.

But no, the world has changed, is changing. With better winemaking and increased investment the true potential of  this region’s wine industry is being unlocked. The challenge now is to get the word out and then to get the wine out. I’m trying to do my part on the former, but the latter is the bigger challenge in the long run because of regulatory structures that make marketing and distribution costly and inefficient even within Canada to say nothing of international trade.

O Canada, my how you’ve changed. I’m looking forward to visiting again in a few years to see how present trends develop.

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This post owes a debt to John Scheiner’s writings, especially The Wines of Canada (Mitchell Beazley, 2005), John Scheiner’s Okanagan Wine Tour Guide (Whitecap Books, 2006) and his British Columbia Wine Companion (Orca Books, 1997).  Scheiner’s blog and books are great resources for anyone who wants to know more about B.C. wines.

Grandi Vini (or Joe Bastianich is Nuts)

November 8, 2010 By in book reviews, Italian wine 1 Comment

Joe Bastianich must be nuts.

The food business is crazy; you have to be nuts to own even a single restaurant in today’s market much less the twenty that Joe owns in partnership with the equally insane Mario Batali.  The wine business is maybe even crazier; Joe owns three wineries in Italy and several food and wine shops, too,  just in case he ever has a moment of free time with nothing else to do!

And now there’s this book, Grandi Vini.  You don’t have to be nuts to write a book (although I think it probably helps), but I’m not sure a really sane person would write this book, which aims to identify the 89 best wines in all of Italy and tell their individual stories.

Nuts? Oh, Yes.

Why is this nuts? Well, Italy is maybe the the most complex and varied vino terrain in the world. Here in the U.S. we often talk about “Italian wine,”  but really there is no such thing. Mario Batali once said that Italian food doesn’t exist, there are only the regional cuisines of Italy. It’s the same with Italian wine.

Just take a look at De Long’s nifty wine map of Italy shown below — what a crazy quilt! Local wines in Italy evolved from (largely) indigenous grape varieties and co-evolved with the local cuisines.  Common threads, to the extent there are some, are few and far between. 

Some of this complexity is hidden, submerged by regional wine appellations. Soave, for example, is a very familiar name — so familiar that we don’t always recognize it as a wine that comes from a particular place (the Soave zone outside of Verona), is a blend of grape varietals with the very unfamiliar indigenous Garganega playing the leading role and is made in a number of distinct styles (including Soave Classico and the exquisite Recioto di Soave).

The more you drill down into Italian wine, the more complicated (and interesting) it becomes and the more you start to understand how crazy Joe Bastianich must be to attempt to identify the very best wines.

Yes, yes, I know that Gambero Rosso’s famous annual guide Vini d’Italia has done this for many years now, bestowing their “three glasses” tre bicchieri designation on the year’s very best. (Receiving three glasses is like getting three Michelin stars.)

But their team tastes and rates thousands of wine (16,000+ in my dog-eared copy of the 2007 edition) from hundreds of producers (2,206  in 2007) and in the end bestows scores (262) of top prizes.

For Joe to try to do this all himself, despite his intense relationship with Italian food and wine (which now includes Eataly in New York — another Joe and Mario production)  and to narrow down the list even further than Gambero Rosso is … well, audacious at least if it isn’t actually insane.

What Joe Says … and Doesn’t Say

So what about the book? Well, it’s a great read (just because Joe is crazy doesn’t mean he can’t write). Wine is good, I tell my audiences, but wine and a story is much better and the 89 stories that Joe tells here make great reading, both individually and taken as a whole. I am fascinated by what he says … and what he leaves unsaid.

The unsaid is quite striking. Joe’s family is from Istria and he calls Friuli in Italy’s northeast corner his Italian home. That’s where you’ll find his wineries including the eponymous Bastianich. (The Bastianich Vespa Bianco is Wine Economist household favorite.) I consider Friuli one of Italy’s great wine regions, so I was surprised to see just three wines listed here (versus five for nearby Alto Adige and six for the Veneto).

Mind you the three are stunning wines (from Josko Gravner, Edi Keber and Silvio Jermann), but I think there are more Friulian wines that deserve to be raised to the vino Italiano pantheon.  Just sayin’ that Joe shouldn’t short change the home team in his attempt to be objective.

What Bastianich says is significant, too. As I have read through the various entries I find one strong theme: change. Joe is constantly recognizing winemakers who bring new ideas to Italian wine, especially “modernist” ideas. He wants his readers to understand that Italian wine today is not your grandfather’s rather flat raffia-clad Chianti. By implication, I think, he is saying that many “traditional” producers became lazy and let quality slip.

The best producers today are bringing new ideas and technologies to the vineyard and cellar and are making really distinctive wines of quality that honor tradition but are not slaves to it. These are the wines that are showcased in Grandi Vini.

It’s All in the Timing

The best Italian wines find a way to express their unique terroirs while also meeting international standards for quality. The worst Italian wines — and there are many of them — fail utterly and are part of Italy’s enormous overhang of unsold wine.

Italian wine is in a slump right now. U.S. off-premises sales of Italian wines have actually declined in the last year, although they have picked up a bit in the last few months. This is a good time to seek out the better wines. Hopefully Joe’s book will inspire many wine enthusiasts to take the plunge.

I still think Joe Bastianich is nuts for writing a book like this, but I hope he stays nuts for while.  I’d like to see his crazy vision of Italian wine develop and its consumer market grow.

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Grandi Vini: an opinionated tour of Italy’s 89 finest wines by Joseph Bastianich. New York: Clarkson Potter Publishers, 2010.

Vino Ogopogo: Wine Tourism Okanagan Style

November 3, 2010 By in Canada, extreme wine, wine tourism Leave a comment

We recently returned from an “extreme wine” research trip to the surprising Okanagan wine region in British Columbia (click here to read part one of the series).

Surprising? Well, many U.S. wine drinkers find the very idea of Canadian wine surprising (ice wines apart), which is understandable since only a handful of wineries have successfully navigated the process to get distribution south of the border. The wines themselves hold many surprises, if you can find them.

And then there are the wine tourism opportunities. Wow! For a lot of people, this will be the biggest  surprise of all.

On the Wine Tourist Trail

Wine tourism has become big business as enthusiasts seek closer links to their favorite wineries, wine producers try to make more high margin direct sales and the hospitality industry has embraced the wine tourism trend. George Taber has written a fascinating book, In Search of Bacchus, that surveys the global wine tourist scene and gives a sense of the industry’s rising profile.

Wine tourism is a naturally appealing — even if you omit the wine! — because vineyards and wineries are often located in areas of real scenic beauty. But wine tourism in many areas has been slow to develop because vineyards are agricultural zones often  lacking in the expected tourist infrastructure and amenities. And at some point as more people arrive there is tension between farming and tourism. The debate over the Napa wine train captures some of this problem.

Vino Ogopogo

The Okanagan wine region in British Columbia has a decided advantage over most winegrowing regions. Usually the wine comes first and then the tourist infrastructure slowly develops. It’s the other way ’round here. The Okanagan region has spectacular scenery with four season sports and recreation opportunities that have long attracted visitors. At the center of it all is beautiful Lake Okanagan, a long narrow north-south body of water that feels like a fjord and has just about everything a tourist might desire, including a resident Lake Monster named Ogopogo.

Wine grapes are known to love to look down on lakes and rivers and so do people, of course. So the Okanagan developed its tourist infrastructure long before the current wine boom (which I’ll discuss in an upcoming blog post). We benefited from this timely development on our trip, staying right on the lake at the Summerland Waterfront Resort in Summerland, B.C. and enjoying meals made from regional ingredients at Local, a restaurant just next door. Sipping wine in the evening with the fireplace roaring, looking out across the lake to the vineyards on the Naramata Bench — well wine tourism does not get much better than this.

Raising the Stakes

As this region’s wine industry developed from the 1990s on, many wineries made very significant investments in wine tourist facilities — partly, I think, because of the need to compete with and complement the amenities already here in order to attract tourist business.

Direct sales of the kind that wine tourists provide are extremely important to wineries in this region. Every wine maker I talked to noted the cost and difficulty of getting distribution in other Candadian provinces to say nothing of entering the U.S. market. Direct sales are therefore key and tourists from Vancouver in the west, Alberta in the east and the U.S. down south are a big part of that business.

Burrowing Owl Estate Winery in Oliver a good example of a B.C. destination winery. Perched on a hillside, it is a beautiful facility in a great location that includes the winery, a tasting room, restaurant and an inn with a swimming pool. A must stop on the wine tourist trail, they count on cellar door sales to move most of  their substantial annual production.

Wine economics note: tasting room fees are still very low in this region — amazingly low for anyone who has visited Napa Valley lately. Most of the wineries I visited offered free tastings for a limited number of wines. At Burrowing Owl, a $2 donation was encouraged — the money goes to the a nature conservancy group.

Top of the World

The ultimate wine tourist destination in the Okanagan Valley must be Mission Hill Winery. Inspired by Robert Mondavi’s iconic winery in Oakville, Mission Hill sits atop a peak and looks out over the lake. The winery is stunning, with an entry arch that immediately made me think of the Mondavi winery and a soaring bell tower. Everything inside is strictly first class, too, including comprehensive tours that end with sommelier-led tastings from your souvenir Riedel glass.

As beautiful as the building is, I don’t seem to have taken any photos of it. I guess I couldn’t resist the view (shown above) looking down over vineyards to the lake below. I wasn’t alone: members of a photography club were buzzing around like bees making images of the vineyards, grapes, rose bushes, bell tower and, inevitably and unintentionally, each other.

Mission Hill is the cherry on the Okanagan wine tourism cake. Altogether, this wine region is quite a treat and sure to grow in popularity as the word gets out. We’ll be back — possibly staying at one of the guest ranches in the area, horseback riding in the morning and wine touring in the afternoon, or perhaps taking advantage of vineyard lodgings like the ones at Working Horse Winery.

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This is the second of my “extreme wine” reports on the Okanagan wine scene. Watch for the final post (on the region’s future) in a few days.