U.S. Wine Sales: Five Surprising Facts

wbm_cover_2018-9-1The September 2018 issue of Wine Business Monthly is out and as usual it is full of interesting articles and useful information. As a wine economist, I have to admit that the first thing I look at with each new issue is the Retail Sales Analysis page, which presents recent U.S. wine market data as reported by Nielsen.

I suspect that many readers skip over this section, seeing it as a big table full of dreary gray numbers. How boring! But not to me. I thought you might be interested in five surprising facts I found as I combed through this issue.

But first a quick disclaimer. My old boss when I worked at a presidential commission in Washington DC used to say that there were three kinds of data: out-of-date, incomplete, and forthcoming. In other words, data is never as perfect as you want. I would add a fourth characteristic: expensive. The Nielsen data in Wine Business Monthly isn’t as complete or timely as you might like (data are for the 52 weeks ending May 19, 2018), but they are free, which I appreciate, and tell an important story. OK, here are the five facts.

#1 America’s Wine?

Europeans think of wine in terms of regions, according to conventional wisdom, but many Americans focus on grape variety. So which varietal wine is #1: Chardonnay or Cabernet Sauvignon?

The answer is … both! Or rather, the varietal that tops the table depends on which table you look at. If you are interested in volume sales, Chardonnay is still number one, and by a large margin — 30.6 million cases in the 52 weeks of the survey for Chardonnay versus 24.6 million cases for Cabernet Sauvignon. Pinot Gris/Grigio comes in third with 17.1 million cases.

But if dollar value of sales is your focus, Cabernet narrowly edges out Chardonnay with about $2.56 billion in sales for Cab versus $2.54 billion for Chard. This result reflects Cabernet’s higher average bottle-equivalent price of $8.66 versus Chardonnay’s average price of $6.91.

#2 Most Expensive Varietal Wine?

Cabernet’s average price is higher than Chardonnay, but it isn’t the highest price that Nielsen reports. What varietal wine is #1 in terms of average bottle price? You might think Pinot Noir and you would be almost right. The average bottle-equivalent retail price of Pinot for the survey period was $10.43.

That’s a good average price, but not as high as #1 Zinfandel’s $11.19! Zinfandel? This really caught me by surprise because Zinfandel’s sales are relatively low. Pinot Noir’s sales by volume are more than four times Zinfandel’s.  But obviously not all the Pinot sales are in the $20+ range and the lower-priced products bring the average down.  I trust the data, but I am still surprised. More research needed here.

#3 France Strikes Back

I might have written “The Empire Strikes Back” because France is the empire of wine in terms of history and reputation. But French wines struggled to compete in the last dozen years and have fallen below Italy, Australia and New Zealand when measured by total sales value and below Australia, Italy, Chile, Argentina, and New Zealand when measured by volume.

But France is surging back into contention, with 17.3% value growth and 14.4 % volume growth in the 52 weeks reported here. France’s average bottle price is $12.85, higher even than New Zealand’s $11.52.

Some of France’s exports to the U.S. market are quite expensive — Champagne in particular and high-end Burgundy and Bordeaux. But the French sales surge is largely powered by Rosé, which is the fastest growing wine category, up 54% by value and 32.7% by volume. Cowabunga — France is riding the Great Pink Wave back into the U.S. marketplace!

#4 Australia’s Real Challenge

Australian wine imports are a puzzle. Australia is the #2 import behind Italy measured by sales value and #1 ahead of Italy in the Nielsen data when measured by volume (12 million cases versus 10 million cases). But both value and volume fell during the 52 weeks measured here, continuing a trend we’ve seen in recent years. Aussie wine got a bad reputation a few years ago, the usual story goes. Buttery Chardonnay, sweet Shiraz. Australian wines went out of fashion.

My Australian industry friends now have the U.S. market in their sights once again, having successfully penetrated the Chinese market. Australian sales to China now outpace their exports to the U.S. and the U.K. markets.

I expect that the new sales effort will yield results, but the Nielsen data suggest to me that selling more wine in the U.S. market is not the real issue. Australia already sells lots of wine here. The problem is price. The average bottle price of Australian wine reported here is just $4.97, which is the lowest average bottle price of any of the countries that appear in the report. Price, not volume, should be the target and raising price is never very easy.

#5 Washington is Like a Foreign Country

Everyone knows that I am a big fan of Washington State’s wine industry, which doesn’t always get the respect that it deserves. It’s that #2 thing. Washington State lives in the shadow of its big wine neighbor, California. California’s 114 million case sale dwarf’s Washington’s 5 million cases in the Nielsen data.

Washington is small compared to California, but it doesn’t seem too tiny if we switch the frame of reference a bit. If we think of Washington as a foreign country, then the perception of its size changes a bit. At 5 million cases sold, Washington’s impact on the U.S. market is less than Australia and Italy, of course, but it is larger than Argentina (4 million cases in the U.S.), Chile (3.9 million cases) or New Zealand (3.1 million cases), and even bigger than Spain and France put together in terms of their U.S. sales volume.

Washington’s importance is also apparent if we look at sales value rather than case volume. With $602 million in annual sales, Washington’s U.S. sales are larger than all import countries except Italy and Australia. Looking just at U.S. sales spins the data to magnify Washington’s impact, of course, but comparing it just with California spins it the opposite way.

What’s the right way to think of Washington’s wine industry? Maybe we should compare it to New Zealand. Both regions have developed vibrant wine industries in just a few decades. Both punch above their weight with average bottle prices ($11.52 for New Zealand and $9.92 for Washington) well above the U.S. average of $7.21 or the California average of $6.85. And both, of course, are important competitors in the U.S. market.

>><<<

The Wine Economist will take a short break so that Sue and I can attend an important wine celebration in Italy. We’ll give you a full report when we return.

Money & Wine: Good, Bad & Ugly

cattivoWe are living in a golden age for wine, or at least that’s what many people (including Jancis Robinson, Matt Kramer, and Richard Hemming) have said. Never before have so many wine lovers around the world been able to enjoy so much good wine from so many places in so many styles at so many price points. If that’s not some sort of golden age, I don’t know what is.

The wine world isn’t a utopia, of course. And, like all golden ages, this one probably contains the seeds of its own eventual demise. But I think it is pretty clear that these are s good times to be a wine drinker, don’t you think?

Jefford on the Money Problem

So was I a bit shaken when I came across Andrew Jefford’s Decanter column on “Money & Wine.”  Jefford doesn’t see a golden age at all. Wine is sick, terminally ill, and the disease that is killing it is money. He writes that

“The biggest wine contaminant (far worse than sulphur) is money. I don’t know how to put it any other way. The contamination is growing worse all the time. The better the wine, tragically, the more money it contains. Fine wines are now brimfull of money.”

Ironically, having written about the devastating disease of money in Decanter on Monday, Jefford’s weekend column in the Financial Times was about a completely different devastating plague: grapevine trunk disease. Wow, wine is really sick, sick, sick.

I suppose there is a good reason why Jefford didn’t talk money to money, which he could have done by publishing his anti-money column in the FT instead of Decanter. In any case, it is clear that Jefford believes that wine is cursed. Golden age? Nonsense!

Masters of the Universe investors sweep up the best wines, pushing prices beyond the reach mere money mortals. Price becomes just a way to score the game and higher is better. Worse, I suppose are wealthy individuals who say that they are investing in fine wines but actually just want to lock them up and treasure them like Gollum’s precious ring. I have called their behavior “conspicuous non-consumption” with a nod to Thorsetin Veblen.

Jefford’s Lament

Jefford takes this whole money-wine syndrome seriously because, as a wine writer and critic, he feels that he is part of the problem. Once critics like Jefford have identified an outstanding wine, it becomes a target for those with money and pretty soon money is all that matters.

Worse, critics sometimes praise ludicrously expensive wines, presumably because they are really good, thus unintentionally reinforcing the notion that wine quality can be measured in dollars, euro, pounds, and yen. “I am guilty of this myself,” he writes, “and wholly complicit.”

One ironic result, Jefford notes, is that the wines that wine critics praise are sometimes bid up to such extraordinary prices that the critics can’t afford to buy them.

“They may briefly encounter great wines at a tasting, but they don’t own them, drink them, or develop a relationship of understanding with them in the way that wealthy wine-lovers are able to. This makes those writers, at best, outside observers of a world to which they will never belong …”

Don’t Cry for Me …

There is truth in this, I guess, but one thing that I have learned from personal experience is that pretty much no one feels sorry for wine writers. They taste wines that most people can only dream of sampling. That they cannot afford to own cases of them and have personal relationships with them doesn’t seem like a serious problem.

I am not an A-List wine critic like Jefford, but even a wine economist like me has occasional opportunities to savor great wines and have memorable wine adventures. I have learned not to speak too loudly about these experiences, however, and to write about them with care. None of my wine enthusiast friends would have any sympathy for me if I offered Jefford’s complaint as my own. Maybe Jefford’s friends are more sympathetic to his needs?

To DRC and Beyond

Tom Wark’s reaction to Jefford’s column (“Andrew Jefford and the Contamination of Wine”) acknowledged that there is a sliver of the market (fine wine, as Jefford defined it in the first quote above) where money is out of control. Top flight Bordeaux and Burgundy get lots of attention, but they are essentially irrelevant to the vast majority of wine enthusiasts. To generalize, even implicitly, from DRC and Petrus to the broader market is to misunderstand the impact of money on wine.

Robert Joseph’s Meininger’s Wine Business International column on “Is Money Ruining Wine”  broadens the discussion in several interesting ways while still retaining the fine wine focus. Yes, great wines cost more today than 50 years ago, Joseph says, but global wealth has increased at the same time. Maybe today’s doctors and lawyers can’t drink Petrus every night (or have a relationship with it, I suppose), but they can afford to taste it on occasions if they want and that’s not nothing.9781442234635

Joseph doesn’t mention it, but part of the money problem, in terms of higher price, is that interest in wine has spread around the world, so that affluent buyers in China and the U.S. seek their share. Price allocates the limited supply — more for New York and Shanghai means London gets less. That’s how markets work

It’s Complicated!

As a wine economist, I am supposed to know something about money and wine. The more I learn, the less willing I am to make bold statements as Jefford has done. There are just too many sides to consider.

That’s how I ended up writing my 2016 book Money, Taste, and Wine: It’s Complicated. I made a list of all the different ways that money could affect wine and then wrote this book to try to make sense of the situation. I ended up examining the good, bad, and ugly of money, taste, and wine. The book ends on a cautiously optimistic note, which is how I will end this column.

Money has many and varied effects on wine, just as it does on everything else. But wine is resilient and wine lovers are, too. Money and markets bring the world of wine to us, creating this golden age. Does the fact that the Golden Rule — he who has the gold makes the rule — is part of the golden age package (at least when it comes to fine wine) ruin everything? That’s up to you to decide.

It’s Not About the Wine

In the meantime, Jefford’s most recent Decanter column, Wine & the World, argues that money isn’t the world’s only curse — politics, culture, and environment are all being corrupted and society itself fragmented. If wine, with its privileged global status, isn’t part of the solution, Jefford argues, it is part of the problem.

The world is a messy place and Jefford’s goal seems to be to make you consider that fact and what you are doing about it with every glass of wine you drink. It’s not really about the wine, it is about you.

Heal the world — that’s a lot to ask of wine, but the healing needs to be done and wine is as good a place to start as any.

>><<<

The Wine Economist will take a brief break for the end-of-summer holiday and return in two weeks.

The Cabernet Boom and Its Discontents

Our recent trip to the Napa Valley provokes two columns: this one about the Cabernet Sauvignon boom and next’s week’s about Zinfandel’s uncertain future.

>>><<<

What winegrape variety comes to mind when I say “Napa Valley …”? There are lots of possibilities. Chardonnay. Merlot. Sauvignon Blanc, of course! Hey, Larkmead makes a tasty Tocai Friuliano.

hqdefault

But I’ll bet that your “fill in the blank” answer was Cabernet Sauvignon and there are several good reasons for this. Cabernet is a noble grape and many of the world’s great wines are made from it or with it. American consumers are in love with this winegrape variety. Cabernet Sauvignon has recently overtaken Chardonnay as America’s #1 favorite.

Cabernet is #1

According to recent Nielsen data taken from the August 2018 issue of Wine Business Monthly, sales of Cab wines totaled more than $201 million in the most recent 4-week period, up 3.9% from the previous year. That compares with $190 million and 0.5% growth for Chardonnay, which has for years topped the league table.  Next in line but far behind, is Pinot Gris/Grigio ($96 million / 1.3% growth) and Pinot Noir ($82 million / 2.6%). The fastest-growing category is Rosé, as you might have guessed, with 67% growth on a relatively small $22 million sales base.

Consumers love Cabernet Sauvignon and growers love it, too, because they see it as a potential solution to the their financial squeeze. The costs of land, labor, equipment, and supplies keep rising, but the prices of many grape varieties have been stagnant, putting pressure on profits and, in some cases, generating rivers of red ink.

The Cabernet grape price premium can be substantial according to the 2017 California Grape Crush Report. Cabernet grapes fetched $700 per ton on average in Lodi, for example, compared with $552 for Merlot and Chardonnay. A ton of Cabernet sold for $2209 on average in Mendocino county, $2352 in Lake Country, and about $3000 in Sonoma County.

Premium Prices

Napa county topped the list with an average Cab price of $7,421 per ton. That average translates into a $70+ bottle price using the one-percent rule of thumb. And that’s the average. The very best Napa Cab grapes from exceptional sites sold for $10,000 per ton and more. Lesser Cab grapes sold for less, of course, but still generally for more than other grape varieties. Cab Rules.

And it’s not just a California thing. Cabernet is now the most-planted winegrape variety in Washington state, too, with 62,200 tons harvested in 2017 compated with #2 Chardonnay’s 39,300 tons.  The overall average price of Washington winegrapes was $1200 per ton, with Cabernet selling at a significant premium at $1500-$1600 per ton.

No wonder more and more Cabernet is being planted wherever it might possibly grow successfully. Jeff Bitter, recently appointed President of Allied Grape Growers, presented the results of the 2017 California Nursery Report at the Unified Wine & Grape Symposium meetings in January. Bottom line: Cabernet is big and getting bigger.

The Nursery Report provides insights about what grape varieties are being planted or grafted, which foretells shifts in winegrape production a few years from now when the vines are productive. The 2017 report showed that 72% of new vines were red varieties with only 28% white. Cabernet vines accounted for an incredible 37.4% of all new vines followed by 19.5% for Pinot Noir and 16.7% for Chardonnay.

Cab Pipeline is Full

If you combine Cabernet with other varieties that are often blended with it (such as Merlot, Malbec, Cabernet Franc, and Petit Verdot), they account for over 42 percent of all new California vines. I am not sure what the composition is of the vines they may have replaced, but I suspect the disproportionate emphasis on Cab and Cab blending grapes represents a significant net increase in future production.

Cabernet’s dominance is noteworthy, but the upward trend in Cab plantings is part of the long term trend that Benjamin Lewin MW described in his 2013 book Claret & Cabs: The Story of Cabernet Sauvignon. Zinfandel, not Cabernet, was the most-planted winegrape variety in the Napa Valley in the decades following Prohibition.

Zin was thought to  make the best Claret, according to Lewin, which of course is interesting because Claret is the name the British gave to Cab- and Merlot-based Bordeaux wines. Ridge made a “Claret”  in 1981, for example, from Zinfandel, Petite Sirah and Carignan and I’ll bet it was delicious!claret

Cabernet Sauvignon was a minor player on Napa’s wine scene, Lewin notes, although it made some historic wines including the great Beringer Cabs of the 1930s and the Beaulieu Georges de Latour Private Reserve wines that André Tchelistcheff made between 1938 and 1973.

The Napa Cab boom really picked up speed in the 1970s as new quality-driven wineries (think Robert Mondavi) focused on Cabernet. The Judgement of Paris in 1976 put Napa Cab firmly on the wine world’s radar.

No wonder new investment flooded into Napa Valley and Cabernet plantings expanded rapidly, both in Napa and California generally. Now the steady rise has accelerated, taking on some boom-time characteristics. The cycle of higher Cab prices, higher vineyard valuations, and increased Cabernet plantings continues.

Stein’s Law

Cycles and booms are a common characteristic of agricultural and financial markets, both of which I have studied. There are two things I have learned about the booms. First, they are driven by internal logic that seems bullet-proof from inside the cycle.  People (like me) who try to call turns often end up looking like Chicken Little fools. So don’t expect me to forecast a Cabernet bust!

The other thing I have learned is that Stein’s Law always applies in the long run. Named for the famous economist Herb Stein, Stein’s Law is says that if something cannot go on forever … it will end. And I think that Cabernet prices cannot go on going up forever (especially with new plantings on the rise) any more than housing prices could defy gravity forever a dozen years ago, no matter how how much rising prices might seem baked in the cake at any particular moment.

That doesn’t mean that the boom must inevitably be followed by a bust — there are many possible adjustment patterns as Kym Anderson’s analysis of Australia’s winegrape cycles shows. In the meantime, Cabernet is crowding out other grape varieties, including those Zinfandel vines that were once the pride of Napa Valley winemakers. That’s where we are going in the next column.

Sue and I came to the Napa Valley with Zinfandel on our minds. Circle back next week to find out what we learned.

>>><<<

The Boom Varietal image above comes from a 2011 Sky Pinnick documentary of the same name about Malbec, which is sort of the Cabernet Sauvignon of Argentina. I was pleased to be part of the cast for this award-winning film. The film talks about the rise of Malbec in Argentina and the understandable concern that the boom could go bust (Argentina has a history of boom and bust).

 

The American Wine Industry’s Achilles Heel: Labor

lodiI tell my friends that the wine business is a people business and it is really true. Relationships matter a lot in wine. One of the reasons that Sue and I so enjoy our work is the opportunity to meet and get to know so many wonderful people.

People are the wine industry’s strength, but they are also its Achilles heel and finding ways to adapt to a world with changing labor market conditions is perhaps wine’s greatest current challenge. We saw several aspects of the evolving labor crisis during a recent visit to the Napa Valley where I spoke at the California Association of Winegrape Growers’ (CAWG) summer conference.

Trouble in the Vineyards

We talked with a number of winegrowers who were understandably focused on their vineyards — how to get the hard work of winegrape farming done and the crop harvested efficiently in the current farm labor environment. Migrant labor policies are the main issue here and the impacts extend beyond winegrapes to virtually all California agriculture.

Farm labor generally means migrant labor, including a substantial proportion of undocumented workers. Current federal policy is decided unfavorable to the needs of farm employers and the progress is very slow to craft useful reforms.

Large-scale grape farming depends upon these workers, which is very risky because their work status and the policies that affect them are so uncertain. Mechanization — mechanical harvesting and also increasingly mechanical pruning — is the most direct response, which reduces labor uncertainty exposure even if it doesn’t eliminate the problem.

Matt Parker, the President of Silverado Investment Management Group, which farms 20,000 acres, told the CAWG audience about the strong mechanization dynamic driven by cost, uncertainty, and technical change. Mechanically-harvested grapes can be as good as hand-harvest grapes and are sometimes even better because an entire vineyard can be harvested quickly (and sometimes at night as in the photo above) with machines, whereas hand-harvest may take many days and grape quality can deteriorate.

Everyone we spoke with wanted to see the migrant worker situation resolved so that the cloud of uncertainty that hangs over their businesses and the lives of the workers might be lifted. But I didn’t hear many optimistic voices. Stay tuned.

Beyond the Vineyards

Harvest and vineyard workers are not the only labor market issue we found in Napa. A friend with talked with runs a business that is a major supplier of packaging products to the wine industry, with a large warehouse and light manufacturing facility south of the city. Labor was on his mind as he showed us around his operation.

Labor constraints limited the efficiency of the business, which was running one shift instead of the two or three that it could handle. Rising wages were a concern, of course, but availability was a bigger long term issue. Housing shortages and cost, transportation bottlenecks, and immigration policy all contributed to the uncertain availability of workers.

His solution was automation and his company is making major technology investments both to increase production flexibility and efficiency and to reduce exposure to labor cost and availability risk.

Truckloads of Trouble

One of the CAWG conference’s most interesting speakers was Yvonne Sams of G3 Trucking, a company that many vineyards and wineries rely upon to get grapes to the cellar quickly and at affordable cost during harvest.

“Do the math,” people say, and here is the stunning winegrape trucking math. California produces about 4 million tons of grapes in a typical year (if there is such a thing). That is equivalent to 170,000 truck loads of grapes over the harvest season, according to Sams, with about 2000 truck loads on peak harvest days. The typical load travels about 40 miles. That is a lot of trucks, highway miles, and driver shifts.

Everything about this process is closely monitored and some elements, such as driver cab-time and break periods, is tightly regulated. Driver regulation is about to get more strict, with the result that each driver will be able to manage fewer loads than in the past. Thus the current driver shortage will likely increase. Sams reported that one trucking company now advertises on television specifically targeting women, who are under-represented in the industry, in the hopes of expanding the potential driver pool.

What’s the solution? No one wants to see their grapes rotting in bins waiting for a truck and driver to appear! Sams reported a number of initiatives. More trailers, for example, could increase efficiency by reducing the time that drivers spend waiting to load and unload. Ideally the truck and driver would appear just as the trailer is filled and then drop it off at the other end, picking up a new load while the trailed waits to be unloaded.

We also heard the basic outline of what you might think of as an Uber for truckers, which would allow truckers with available time to more efficiently match up with waiting loads.

Finally there is Elon Musk’s favorite strategy — autonomous trucks (Musk’s would be electric, of course) that need no driver but do require pretty sophisticated software and, as we heard from a representative of Verizon, would benefit by the roll-out of 5G cellular systems.

Napa at the Forefront

Many U.S. industries are struggling to cope with labor issues today. Agriculture, including wine grapes, struggles a bit more because of the traditional labor-intensive model and the relatively short half-life of freshly-harvested goods compared with manufactured products.

Napa, because of its high housing costs and transportation bottlenecks, is particularly affected. Napa’s wealth insulates it a bit, I suppose, but also provides resources for technological labor-replacing systems. As these case studies show, there is no escaping the wine industry labor crisis because it is not one problem, but many, that all negatively impact production, cost, and profitability.

As I wrote in a 2017 column on vineyard labor issues

Are the machines coming to a vineyard near  you? No, they are probably  already there and, as vineyards — even those in iconic regions — are replanted or renewed, you can be sure that one factor that will be considered is the potential to maximize technological compatibility.

Hand work in the vineyards is not going to disappear and many wineries will continue to rely upon  their teams of highly-skilled vineyard workers for years to come. But what we are seeing is that the business model associated with vineyard labor is changing rapidly. Technology, economics and anti-globalization politics are all part of the dynamic.

>><<<

Thanks to Sue Veseth for the photo of workers and machines at a night harvest in Lodi.

 

 

 

The IKEA of Italian Food & Wine? Welcome to FICO Eataly World

eataly1If you have ever visited an IKEA store I’m sure you have vivid memories of the experience. The stores are huge (30,000 square meters on average, I’m told, although there’s one in South Korea  that’s almost twice that size).

Each store is organized around a journey that customers take from room to room, space to space, category to category, pausing only at the restaurant for Swedish meatballs before passing through the check stands, their bags and carts filled with Scandinavian-inspired home goods.

IKEA of Food and Wine?

FICO Eataly World, located just outside of Bologna, Italy, reminds be a bit of IKEA, especially because of the journey its visitors take. But there are many differences, too. Eataly World is much larger than an IKEA store. At 100,000 square meters (over 1 million square feet!), it is more than three times the size of your typical IKEA and almost twice as large as that Korean super-IKEA. Food (and wine) are at the center of the experience. And Italy, not Sweden, is the guiding star.

Sue and I visited  FICO Eataly World during a recent stop in Bologna, where we lived for a semester some 20  years ago when I taught at the Johns Hopkins School of Advanced International Studies Center there. We’ve visited other Eataly locations in the past — New York City, Milan, and the much smaller Eataly Bologna located in the historic center’s famous market, just steps from our old apartment on Via Pescherie Vecchie. But this one was different in more ways than scale.

FICO (Fabbrica Italiana Cantadina) Eataly World is located outside the city core, close to the convention centers that draw thousands of visitors to Bologna each year. Lots of free parking and regular bus service from the train station makes it easy to access. But the location on the outskirts changes things a bit — Eataly World is a stand alone culinary theme park destination where the other Eatalys we’ve visited have been more integrated into their neighborhoods.

The Eataly stores in New York and Milan bring a whole Italian market, with shops, restaurants, and vendors of fish, cheese, salumi, fruits and vegetables and so forth, all under one roof with all the hustle and bustle you would expect. The central Bologna Eataly is a little different — the bookshop is the main feature that I remember — but that’s because it is embedded in a historic bustling market just off Piazza Maggiore and does not need to recreate one. The food court, located across the alley from the main store, is a fine addition since our last visit.

Eataly World’s vast scale suggests a grander vision. There are dozens of shops and stalls featuring distinctive foods from all over Italy, and 45 “eating points” — kiosks, cafes, restaurants — serving regional cuisine. There are 20 acres of small demonstration farms and vineyards, so you can meet the pigs and squeeze the grapes, and some of the final products are actually produced on site. We ran into a group of small children who watched in fascinating through a glass wall as a robotic baker made batch after batch of tasty cookies.

100

You can make of Eataly World what you like — a place to shop or hang out, a place to eat and drink, or even an opportunity to exercise (you can rent bikes to shorten your journey time inside the big building). But education is an important function, too, both the organized classes that are always on offer and the one-to-one conversations with staff at each stand.

What About the Wine?

One of our goals in visiting FICO Eataly World was to see how they dealt with Italian wine. This is a big task as Italy is home to hundreds of grape varieties and thousands of wineries. I nearly went crazy trying to narrow the wine list down to a few important wines in my book Around the World in Eighty Wines. It would take an IKEA-sized facility to do real justice to the diversity of the wines of Italy — and that is more space than even Eataly World has to spare.

That said, the wine program we found was very good. There were 2000 wines for sale, organized by Italian region as they should be, ranging from modest to noble. More to the point, there were 100 different wines available by the glass or in flights.

A knowledgeable young staff member ascertained our interest in learning about Lambrusco and arranged a small tasting of two completely different ideas of the wine, both quite dry but one dark and powerful and the other lighter and fruity (see photo below). It was a good experience and a good way to learn about the wines and have fun, too.

Wine calls for food and there was a nice Bolognese restaurant attached to the wine shop — one food/wine option among many at Eataly World. We had lunch at a foccacia shop (we saw the foccacia being made in front of us). I had a sandwich with Mortadella and a glass of that dark Lambrusco — great combination.

So What?

So what should we think of FICO Eataly World and its ambitious wine program? Well, what do you think of IKEA? Personally, I find it kind of bewildering with the crowds, noise, and its cornicopia of products, most of which are irrelevant to my life. But I like to go there — yes, for the meatballs — because it isa place where I can get ideas and stumble upon things that I didn’t know I would like. It surprises and delights more than it confuses, I guess.

I kind of like FICO Eataly World in the same way I kind of like IKEA. Based on our single visit, it seems full of stuff that overwhelms but gives me ideas and a chance to stumble on something I wasn’t looking for (the Sicilian shop and its great cannoli and espresso).

But there is a big difference between IKEA and FICO Eataly World. Ultimately IKEA succeeds when it allows its visitors to find their own voice, in a way, through the designs that they choose and the products that they bring into their homes. That’s a big challenge and it says something about IKEA that it is so successful.

But Eataly World sets even a bigger challenge. It wants to tell the story of Italian food and wine and that topic is so vast and complex that it makes IKEA seem simple by comparison. I am not convinced that Eataly World really does justice to its mission, but how could it? It was fun to visit and see which elements of Italian food and wine culture stood out and which ones did not.

Sue’s take on Eataly World was quite positive. It was like a giant first-class IKEA food court where you wanted to try everything even though that would be impossible to do. She especially appreciated the educational components and loved the family-friendly animal exhibits. She thought that, taken on its own terms in both the food and wine components, Eataly World represents Italy very well.

Will we go back to Eataly World on our next visit to Bologna? I dunno. We were there on a quiet Friday morning. I’d like to visit the place when it is busier just to see if it feels like the Bologna market when it is crowded, which is pretty much all the time. But that Bologna market neighborhood is fantastic — Italy World — and I’m not sure Eataly World can compete with it!

If I had to choose between Eataly World markets and the real markets in the centro storico of Bologna, there is no question where I would go. I’d be having a glass of Pignoletto frizzante wine and a plate of Mortadella at Simoni’s  Laboratorio on Via Pescherie Vecchie every time rather than taking the red bus out to the fiera district.

>>><<<

Here is Sue’s photo of two very different ideas of Lambrusco. Enjoy!

2vini

 

Lost in Translation? Misunderstanding Old World and New World Wine

mv5bmti2ndi5odk4n15bml5banbnxkftztywmti3nte3-_v1_ux182_cr00182268_al_The idea that important things can get “lost in translation” holds true on many levels. Sometimes it is literally a translation problem, as Sue and I tried to switch between French and English on our recent trip to Languedoc, Roussillon, and the Loire Valley. For someone like me, who doesn’t speak French so much as just try to say some French words, there is a lot of potential for misunderstanding.

That’s America for You!

But sometimes the translations are from one culture to another and it is the built-in stereotypes that are the barrier, not the language itself. At one point, for example, I was telling a British wine writer about a recent Wine Economist column on the Illinois-based Cooper’s Hawk Winery and Restaurant, which has a wine club numbering almost 300,000 members — probably the biggest wine club in the world.

“Well, that’s America for you,” my new friend replied. “Everything’s big.” Well, actually, that’s not true. America certainly is big in many ways — it is the world’s largest wine market, for example — but that’s not an explanation in this case. Cooper’s Hawk’s massive wine club isn’t typical of wine clubs in the U.S. or anywhere else. It is an exception and invites further study precisely because it is unique for the U.S. or any wine market. Viewing it through a “big America” lens doesn’t really help at all.

Which brings me to this: we were gathered in Perpignan for a briefing and tasting of some of the wines from Roussillon. The English/French translation was going pretty well, but cultural elements were still problematic. At one point one of the appellation ambassadors was explaining the rules of the local wine game. The wine grapes used in the AOP wines were specified and the proportions dictated too — no less than x percent and no more than y percent of this or that grape.

Everything’s Mandatory or Forbidden

An American journalist in the back of the room raised his hand and asked the obvious question. Why require these particular proportions of the specified grapes? The New World subtext was clear (I am fairly fluent in New World, so trust me about this): why make the particular blend mandatory?  To an American, the AOP system sometimes seems a bit like the old Soviet Union, where (according to an old joke) everything was either mandatory or forbidden. Why not just let the winegrowers be free to make the best wines that they can using whatever proportions they think best?

But that’s not the question that the local experts heard because they were steeped in Old World wine culture, where requirements like this are baked in the AOP cake and more blending freedoms comes with a lesser IGP designation. So they answered the Wine 101 question they thought they heard, which was why blend grape varieties at all and  talked about the benefits of blending vs single grape variety — not why require a particular grape blend. Needless to say, neither side of the conversation found the exchange very satisfying and happily everyone quickly moved on.

(The American journalist vented that he planned to write a column titled “Stupid French Wine Laws,” but I am glad to say that he didn’t.)

The problem is, in part, is a question of the importance of typicity. Making good or at least marketable wine is the aim in the New World, the idea of crafting the wine to be  typical of a  particular region is literally a foreign concept.

In the New World, in fact, “typical” is sometimes used as a put down — that’s so typical! In the Old World, however, typical often means true-to-type, satisfying a standard, and is a good thing. When we were in Carcassone, home of cassoulet, the thing I wanted most was typical cassoulet, not some fusion mashup, as good as it might be.

Old versus New World Regulations

AOP rules are meant to assure that designated wines are true to the local standard. American appellation rules,  on the other hand, are geographic indicators that have little to say about what’s in the bottle apart from where the grapes are grown and the wine itself made (the Cooper’s Hawk winery is in Illinois, for example, and it therefore cannot put “Napa Valley” on the label of a wine that is made entirely from Napa Valley grapes — it must use an American appellation).

I do not see much evidence that Old World appellation rules are invading the New World (although there are some who advocate greater regulation), but we met a number of Old World producers who are learning to think and speak New World. Sue and I have seen more and more emphasis on the less restrictive IGP wines, for example, and there are several reasons for this.

Lesser is More?

One reason for the move to IGP and other “lesser” designations is that many winemakers simply want to freedom to make interesting rather than typical wines and this can be a good thing. Don’t forget the influence Super Tuscan wines have had in Italy. Sometimes, as we saw in Valpolicella a few years ago, the IGP wines are produced to fill unexploited market niches.

Climate change is another reason for winemakers to look beyond AOP rules. Changing climate undermines the logic of winemaking rules established decades ago when growing condition might have been much different. We heard this discussed on our trip to France, but I can’t really tell how much it is driving this particular movement compared with market forces, which are surely very strong.

I am not sure there is much that can be done about the translation problem, but I am going to try a bit harder to see things from both the Old and New World sides, so that less  understanding is lost along the way.

Discovering the “Invisible” Cooperative Wineries of Languedoc and Roussillion

caramanyThey say that there is strength in numbers, which may explain why wine cooperatives tend to emerge during periods of crisis, when individual winegrowers are practically powerless to defend themselves and only collective action holds hope.

The cooperative in Caramany, the Vignerons de Caramany, was founded in 1924 in response to the Phylloxera crisis. It experienced ups and downs in the century that followed and seems to be thriving today — a good sign for Caramany and for French cooperatives generally.

Strength in Numbers

Caramany is a village of 150 inhabitants in the Pyrénées-Orientales scenic L’Agly valley in Roussillon. It has its own appellation:  Côtes du Roussillon Village Caramany. The cooperative has 50 members, some of them quite small holders,  growing mainly Carignan, Grenache and Syrah.

We were in Caramany to learn about its cooperative and its wines during our recent press tour to Languedoc, Roussillon, and the Loire Valley. Cooperatives were on our radar because they are very important in all these regions as they are in Europe generally. Cooperatives produce about 70% of all wine in Languedoc, for example, making their success critically important to the wine industry.

You sometimes have to look closely at a wine label to know that a cooperative has made the wine — seeing Caves Coopérative for a French wine or Cantina Sociale Cooperativa for an Italian one is a sure indicator, but sometimes the link isn’t clear, especially if the wine is sold through a negociant or, as is increasingly the case, made for a private label customer such as a supermarket.

Invisible but Important

carmin

According to the latest edition of the Oxford Companion to Wine, cooperatives probably account for more than half of all the wine produced in the big three Old World wine countries: France, Italy, and Spain. These “invisible wineries,” as I have called them, are one of the most under-appreciated elements of the global wine market despite the commercial success of some of the wines. One of the top-selling Prosecco wines on today’s market — La Marca — is produced by a second-level cooperative — a cooperative of cooperatives.

Some Italian cooperatives — I am thinking Alto Adige and Piemonte in particular — are know for their high quality. But cooperatives in the south of France have the opposite reputation, which they continue to battle to change. It is easier to produce new, better wines that a new reputation.

The Vignerons of Caramany impressed us with their commitment to making delicious, market-friendly wines, which we sampled while eating a Catalan barbeque lunch that included snails grilled over live coals, grilled meats (including delicious blood sausage), and a variety of salads. One wine (see top photo) was a tribute to the past, but others looked to the future.

tremoineThe Reserve Rouge Carmin, for example, is a blend of Grenache, Syrah, and Carignan (the Carignan was vinified with carbonic maceration while the Grenache and Syrah use conventional methods) that was one of my favorites. Delicious with the food we were served and impressive generally. Its packaging is modern and appealing and it sells for a premium price — about 8 to 10  euro, as I recall, which is impressive for a wine from this region.

There were wines from other cooperatives at the lunch and they were also noteworthy. The Rivesaltes Ambré from the Vignerons de Trémoine is a terrific sweet wine that I could sip  all day.

Sleep No More

So what has changed to make these cooperatives (and many others that we learned about) so different from the stereotype of sleepy, inefficient (and sometimes not very clean) cooperative cellars? Well, it isn’t that the cooperatives have simply become stronger — more strength through more numbers — because that’s not the recent trend. Cooperatives seem to be under attack to a certain extent, with the next generation of winegrowers looking beyond old practices to new market opportunities. An association of independent producers has been formed in Languedoc, providing a different sort of strength in numbers through collective marketing not production investment.

Some of the new independent projects are inspired, I was told, by Department 66, a wine project initiated by Dave Phinney and located in the Maury appellation of Roussillon. Its Grenache, Syrah, Carignan blend D66 wine sells for $38, which is a super-premium price for this region. A special old vines Grenache-Syrah blend received a 95-point score from Robert Parker and retails for $175. That would sure get my attention.

More than anything I think it has been competition that has stirred French cooperatives to raise their game — competition in the retail market and also competition between and among the cooperatives for the declining group of potential grower-members. Competition is disruptive but has obviously been a good thing and the results are clear when you consider the achievements of a relatively small cooperative in a tiny appellation such as the Vignerons de Caramany.

If other cooperatives are moving in the same direction as the ones we learned about on this trip. then the future of the “invisible wineries” is bright.

>><<<

Thanks to everyone we met on our trip to France and to the wine regions of Languedoc, Roussillon, and the Loire for hosting us.

caveau