Wine, Rice and Drought in Australia

The effects of Australia’s continuing drought on the wine industry are well known; I wrote about drought and other problems that Australian winemakers now confront last September in a post titled Big Trouble Down Under. An article on the front page of yesterday’s New York Times explains how the crisis is deepening and evolving in frightening ways.

The Global Food Crisis

The article is part of a series on the global food crisis. If you haven’t been paying attention, food supplies around the world are drying up (both literally and figuratively), causing chaos in many places. Food riots are reported in the press almost every day. The crisis has many causes. Drought and climate change have reduced supplies in some areas, for example. Increasing demand is part of the problem, too, especially in China where, rising incomes have encouraged greater consumption of pork, which in turn increases the demand for grain. Rich countries like the U.S. are not helping the situation. Our biofuel policies divert food to the gas pump. All these factors push up food prices and the poorest people are the most affected.

As prices rise and surplus supplies shrink, food-exporting countries have begun to impose export taxes or even export bans in an attempt to keep domestic supplies plentiful and relatively cheap. The effect, of course, is to drive international prices even higher and “beggar they neighbor.” The price of rice rose by 40 percent in a single day last week as these export controls kicked in.

The Rice-Wine Connection

What part does wine play in this problem? Australia was until recently a major exporter of rice, but rice is an especially water-intensive crop and the continuing drought in Oz has dramatically limited production there. The Australian drought is a key part of the global rice shortage story. Wine production, however, makes the problem worse.

As the New York Times explains, winegrape production uses much less water than rice and so, as irrigation costs have soared, farmers have shifted production from rice to grapes. The graphic above shows the economic reality of the situation. Even at today’s crisis price of $1000 per ton for rice, higher water costs make winegrapes the more profitable crop. So while drought has reduced production of both grapes and rice, the substitution effect has reduced the impact on grapes and made the crisis in rice even worse.

Many authors suggest that what we are seeing here is part of an important transformation in the global economy. Globalization linked up producers and consumers at the far ends of the earth in the 1990s and produced a world of abundance and falling prices. The growth this helped produced (plus the associated environmental effects, according to some) are now combining to turn surplus into shortage. It is easy to see this in rice, but it is true in wine as well, as I argued in my post on The End of Cheap Wine. Protectionist policies conspire to raise the problem to crisis level for those who are least able to deal with it.

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.

Chateau Al Gore

Al Gore won the Nobel Peace Prize last week for his work to publicize global warming and this got me to thinking about climate change and wine. Global warming (and Al Gore) seem to be very controversial issues in the media, but climate change and wine are not: I don’t know anyone in the wine business who does not take the fact of climate change seriously.

You have only to look at these two maps to understand why. They are based upon research by Gregory V. Jones, a geographer at Southern Oregon University. Professor Jones is my “go-to-guy” when it comes to climate and viticulture. He impresses me as a seriously good scientist and I visit his research website frequently to see what he has been working on.

As you can see from these maps, the geography of wine in the western U.S. is likely to undergo very significant changes in the coming years (click on the map to enlarge the image). Some areas that are currently in the “hot climate” range, like Lodi California, and currently specialize in hot climate grapes like Zinfandel may become too hot to make quality wines at all. Some “cool climate” Pinot Noir areas, like Santa Barbara and Oregon’s Willamette Valley, may bet too warm for those varietals and the Pinot will have to be replaced with more heat-friendly varietals such as Merlot, Malbec, Syrah or Cab. And some areas that are now considered too cold for quality wine production may become viable.

I have been reading some of Professor Jones’s scientific articles and it seems to me that the case for a general if uneven warming of grape growing regions in the western U.S. and around the world is very strong. The trend is weakest in coastal regions where maritime influences come into play and strongest inland — areas like California’s Central Valley and Washington’s Columbia Valley on the map.

There are a variety of climate factors that affect a region’s winegrowing potential including average temperature during the growing season (that’s what the map is showing), the length of the season (number of days between the last spring and the first fall frosts), the severity of vine-damaging winter freezes and the number of very hot days during the critical ripening phase.

In general heat is beneficial up to a point, improving the quality of wine by raising sugar levels and developing flavor factors without affecting acidity. Too much heat, however, and too many very hot days means that the grapes don’t ripen properly. Grapes picked when the sugars are right may lack flavor and those allowed to hang on the vine until the flavors develop lose acidity and are unbalanced. Growing seasons must provide sufficient time between frosts for plants to develop and grapes to ripen. Killing frosts obviously limit how close to the two poles vines can successful produce.

All four of these factors are changing and in some cases the shifts are dramatic. The maps give a sense of how temperatures have been changing (and let me say that the projections shown here appear to be consistent with the long term trends reported in Professor Jones’s research). Growing seasons are expanding, too. One study indicates that the frost-free period for the North Coast region of California increased by 68 days between 1949 and 2002. That is an incredible change. (The average increase for all winegrowing areas studied was 34 days — one whole month!). The number of very hot days has increased in many areas while the threat of deep freeze has diminished.

There are winners and losers from these trends. A front page article in the October 15, 2007 Wall Street Journal reported on one winner, the owner of a vineyard in Tappen, British Columbia, 70 miles north of the Okanogan Valley. Warmer temperatures, a
longer growing season, and relative freedom from killing frosts all helped put this spot on the world wine map (albeit still on the edge of the map). This gain in the Canadian west will perhaps offset a loss back east where, I am told, there are growing problems with the profitable ice wine business. Not enough cold weather to make that sweet wine the natural way.

In fact, researchers have found that most wine regions have been winners from climate change so far. Research has found a strong direct correlation between rising temperatures and scores in the wine magazines. The quality of wine has improved, the correlations suggest, although there are other possible explanations. Perhaps winemakers have become more skilled at the same time that the climate has changed. Or maybe Robert Parker just prefers Chateau Al Gore — big, ripe global warming wines.

I’ve seen the Canadian case before, I think, when Sue and I visited New Zealand in 2004. I can’t get over how many similarities there are between the evolution of the Canadian and Kiwi wine industries (the wines, of course, are very different, at least for now). A wine consultant once advised the New Zealand growers to plant Muller Thurgau, which is the most cold-tolerant grape variety. Now New Zealand grows Pinot Noir in Central Otago, where you would think is would be too cold, and makes nice hot weather Cabs in Hawks Bay, especially in the Esk Valley. In the far north, where New Zealand wine really began, I am told it is almost too warm to ripen grapes properly.

When people talk about climate change causing the ocean level to rise, flooding out coastal areas — well it may be hard to imagine how relatively small changes in natural conditions could have such large effects. But there is nothing imaginary about how the wine map is being redrawn by small (and large!) changes in climate.