Pogo’s Dilemma and the Future of Prosecco Superiore

June 13, 2023 By in Italian wine, wine, wine markets 2 Comments

Pogo’s Dilemma is the theme of this week’s Wine Economist. Pogo’s Dilemma? It is a reference to Walt Kelly’s famous cartoon where the character Pogo reflects, “We have met the enemy and he is us.” Sometimes life is like that, or at least it seems that way to me for the successful winegrowers in the Prosecco Superiore region.

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As last week’s Wine Economist explained, the Conegliano Valdobbiadene Prosecco Superiore DOCG region in north-east Italy is a remarkable success story. The historic home of Prosecco in Italy (and the source of some of the finest wines today), Prosecco Superiore DOCG is in an enviable situation. Nearly every hectare of available vineyard land is planted, yields are pretty much at the maximum, and the wines sell out at attractive prices. There are not many wine regions that can compare.

By the Numbers

Here is the story by the numbers. Prosecco Superiore DOCG had 8,683 bearing hectares of grape vines in 2022, which produced a total of about 103 million bottles of wine and €634 million in revenue for the 2127 producers and growers (including seven cooperatives).

Italy is the top market for Prosecco Superiore DOCG wines, accounting for about 60 percent of sales. The top five export markets are the UK, Germany, Switzerland, Austria, and the United States (Canada is next at #6).

You might be surprised to see the U.S. below Switzerland and Austria on this list. The U.S. sometimes seems to be awash with Prosecco. You see it everywhere on store shelves and restaurant lists. Surely the U.S. drinks more Prosecco than the export numbers suggest?

Prosecco vs Prosecco

Well, yes, Americans are great fans of Prosecco, but only about 3 million bottles of it are Prosecco Superiore DOCG from the Conegliano Valdobbiadene region. The rest is from the much larger Prosecco DOC zone or, like the big-selling Kirkland Signature Prosecco, from the Asolo Prosecco region. These wines can be very good and are generally less expensive. They pretty much dominate the U.S. market with many of the top-selling brands either distributed by U.S. wine companies (think Gallo’s La Marca brand) or sold under their labels. There is a Cupcake Prosecco, for example, a Barefoot Bubbly Prosecco, and now even a Prosecco from NBA star James Harden.

Prosecco DOC is ubiquitous in the U.S. market, but Prosecco Superiore DOCG can be hard to find. You really have to look for it. But the effort is worthwhile. I have organized comparative tastings of different Prosecco wines a couple of times and the Prosecco Superiore DOCG wines always make people smile and ask for more.

Prosecco DOC and DOCG wines are made with the same grape variety, Glera, using the same production techniques. The DOCG zone’s terroirs account for the wine’s distinctive qualities. It maybe isn’t a surprise that consumers who understand the difference between the wines are following the premiumization path toward Prosecco Superiore DOCG. Interestingly, producers told me, as Prosecco Superiore markets mature consumers tend to shift from the Extra Dry style that is so popular with Prosecco DOC wines to Brut and even Extra Brut Prosecco Superiore.

A Good Life (and its Discontents)

Life is good in the Conegliano Valdobbiadene region, but that doesn’t mean there aren’t plans to move ahead. The goal is not so much to sell more wine (yields are maxed out) but to increase margins on the wine and generate new revenue sources through expanded wine tourism offerings. Wine tourism suffers a bit today from limited infrastructure and the nearby presence of Venice. Venice doesn’t give up her tourists once they arrive at the lagoon (day-tripping to the wine country doesn’t really happen), which makes an emphasis on destination wine tourist facilities critical.

Raising margins means raising prices and this is never easy, even for a wine like Prosecco Superiore, which seems undervalued for the quality it delivers. One part of the problem is competition, which tends to discourage price increases. The Prosecco Superiore producers compete with each other in every market, of course, and compete with other Italian sparkling wine producers for the key domestic market. Here in the U.S., sparkling wines from around the world compete with each other for room on wine shelves and space on restaurant wine lists.

The biggest competition for Prosecco Superiore wines here in America and perhaps in other export markets, too, are the generally less expensive Prosecco DOC wines. These wines are popular, heavily promoted by importers, and have consumer-pleasing quality. Prosecco Superiore’s efforts to increase price are limited, in other words, by the good value that Prosecco wines represent. And, of course, most U.S. consumers don’t really get the DOC vs DOCG thing. Prosecco is Prosecco to them.

When is Prosecco Not Prosecco?

This is where Pogo’s Dilemma (we have met the enemy and he is us) comes in. Many producers of Prosecco Superiore DOCG wines are also producers of Prosecco DOC wines (made with grapes from the DOC zone, not the DOCG zone). So, in effect, they are their own biggest competition when it comes to price increases. The better the DOC wines, the harder it is to boost DOCG prices.

The Moretti Polegato family, for example, owns Villa Sandi, a top Prosecco Superiore DOCG producer. Their wine was featured on the by-the-glass list at a top Verona restaurant we visited. But the family also owns La Gioiosa, whose DOC wines are often found on supermarket shelves. The family strategy seems to be to continue to raise the quality of all the wines rather than thinking about one versus the other and seize other opportunities that make sense, too.

For example, you can enjoy a glass of Prosecco at the Villa Sandi wine bar at the Venice airport, or have an excellent meal and perhaps spend the night at Locanda Sandi in Valdobbiadene. The Pogo effect isn’t really a problem in this case.

Smaller producers and those who focus exclusively on DOCG wines must consider different strategies. the family-run Vincenzo Toffoli, for example, produces 250,000 bottles including both Prosecco DOCG and DOC wines from their 20 hectares of vines. Although 95 percent of the wine is sparkling, the family is also exploring the region’s still wine heritage, including sweet passito wines, a delicious dry passito red Colli di Conegliano Refrontolo DOCG, and a ripasso Marzemino Veneto IGT.

The wines of Col Vetoraz are as spectacular as the tasting room view of the steep Valdobbiadene vineyards. Great wine, just don’t call it Prosecco. Prosecco, according to Col Vetoraz and several other producers, has degenerated into a generic term, defined by the big producers on the plains, which doesn’t capture the special quality of their wines. So they’ve banished Prosecco from their labels and literature. The wines they make are Valdobbiadene DOCG. Simple as that.

Refusing the Prosecco name seemed crazy to me at first, but maybe it is a reasonable response to the Pogo effect. If Prosecco is often sweetish and cheap, then maybe a drier luxury wine should have a different name, even if it is one that Americans might be afraid to pronounce. It certainly might work for some producers in their domestic market. Or at least that’s what came to mind when we were shopping for Prosecco Superiore DOCG wines at a big shop in Verona. You can see how the wine display was labeled in the photo.

Sue and I were impressed with the creativity and innovation we encountered during our visit to Conegliano Valdobbiadene Prosecco Superiore DOCG. It is a magical wine from a magical place and the magical people who make it are bound to find solutions to Pogo’s Dilemma.

Anatomy of Italian Wine Industry Success

June 6, 2023 By in Italian wine, wine, wine markets Leave a comment

Economics is sometimes called the “dismal science” and I guess it is true that the Wine Economist is often focused on the problems that the wine industry faces (see the recent column on California vineyard profitability, for example).  So it is a pleasure to write about two wine regions in Italy that have achieved rather remarkable success.

The regions I want to highlight here are Conegliano Valdobbiadene Prosecco Superiore DOCG — home of many of Italy’s best sparkling wines — and Lugana DOC on the shores of Lake Garda, makers of one of Italy’s most distinctive white wines. Although the wines of the two regions are very different, the sources of their success have some things in common. Why are these regions successful? What challenges do they face? Read on.

Wine and Words

Sue and I came to Italy as guests of the Conegliano Valdobbiadene Prosecco Superiore Consorzio to participate in the first edition of a wine literature festival called Co(u)ltura Conegliano Valdobbiadene held in the scenic and historic Castello San Salvatore di Susegana. It was two days of author interviews, masterclasses, walk-around wine tastings, and more that drew a large and appreciative crowd. A highlight was the special recognition of five young Italian writers whose essays on this region were collected and published for the event. (The photo at the top of this column shows a fantastic video-mapping demonstration.)

Sue and I took advantage of this opportunity to meet with winemakers and Consorzio officials and learn as much as we could about this dynamic wine region. When the festival was over, we changed locations to join a small press tour organized by the Lugana and Garda wine consortia. The result was a very revealing set of experiences.

Signature Grape vs Taste of the Place?

I am not sure that anyone has ever thought to directly compare the Lugana DOC and the Conegliano Valdobbiadene Prosecco Superiore DOCG (henceforth Prosecco Superiore DOCG) regions the way we found ourselves doing, but it is an interesting exercise. Although the wines are completely different in terms of sensory and market characteristics, there are still interesting shared qualities that are worth considering.

Each region is best known for wines made from a single grape variety. Glera is the go-to grape in Prosecco Superiore DOCG, producing several variations of sparkling wines as well as traditional still white wines that you can find if you look for them. Lugana DOC is built on the Turbiana (a.k.a. Trebbiano di Lugana) grape variety, which is made in several styles of still white wines and sparkling wines, too.

You might think these wines would be defined by their signature grape varieties, but you would be wrong. These are wines of place. The Lugana DOC wines are different from the many Trebbiano wines you will find in Italy and the particular climate and especially geology of the Lugana region at the south end of Lake Garda has a lot to do with it.

The Prosecco Superiore DOCG wines are distinctive, too. Although you can see the family resemblance in many cases between the Prosecco Superiore DOCG wines and similar wines made from Glera using the same processes from the Prosecco DOC and Asolo DOC zones, to my taste the DOCG wines are often brighter, more alive in the glass. They always make me smile.

The wines of Lugana DOC are distinctive, too, and for a long time, I found it hard to describe them. But a masterclass we attended led by the brilliant Constantino Gabardi has given me the words I need. The Lugana DOC wines are not so much defined by fruit as we often think for white wines, but by salinity and minerality held in tension by acidity. It is a different idea of wine than I am used to and so it is no wonder I find the Lugana wines so fascinating.

In both cases, the land and the grapes interact to create a complicated but fascinating experience. The landscape between the wine towns of Conegliano and Valdobbiadene is varied and stunningly beautiful, which is why, I suppose, it has been designated a UNESCO World Heritage site. Vineyard regions are often pretty, but these vineyards are special — even more spectacular than the Douro Valley. The dramatic landscape terroir is reflected in the wines. Fruitier, they say, in the more rolling hills near Conegliano. More structured on the sharp peaks and valleys near Valdobbiadene.

The area around Lake Garda is beautiful, but it is nothing like the stunning Valdobbiadene landscape. Yet the more subtle variations here matter a lot. The balance and dynamic interaction of Lugana DOC wines stem from the land, in this case, the complicated geology that was left behind as glaciers scraped the landscape eons ago. The soil is very different at lower elevations closer to the lake and the wines reflect this and the balance of salinity and minerality that is so attractive in the glass is the result.

Victims of their own Success?

Both regions have achieved great success and are developing strategies to climb even higher on the wine wall in the future. Having navigated the shifting market tides of the Covid era very well, producers in Prosecco Superiore DOCG find that they have hit a plateau. Virtually every available hectare of potential vineyard land is planted (to Glera for the most part) and yields have been effectively maximized. The challenge is not so much to produce and sell more wine, but to better differentiate the wines in the market to increase margins.

Lugana DOC producers are also victims of their success to a certain extent. The Turbiana grapes that go into Lugana DOC wines sell for several times the value of other grapes in the region, creating a prosperous environment for producers. Lugana is effectively differentiated and benefits from its reputation. The potential problem, I was told, is that just a few export markets dominate sales. What happens, one winemaker asked me, if tomorrow Germans decided they don’t like Lugana wines so much?

The Prosecco Superiore DOCG producers hope to raise margins. The Lugana producers who to expand and diversify their markets. Neither of these tasks is easy in today’s competitive marketplace, but then there was nothing easy about getting to their current high plateau, either. Watch for additional analysis of these two fascinating regions in the weeks to come.

Four Faces of Wine and Sustainability

May 31, 2023 By in Shameless Self-Promotion, sustainability, wine 2 Comments

I made a virtual visit to Umeå, Sweden last week to accept (via video) the Gourmand award that my book Wine Wars II: the Global Battle for the Soul of Wine received as an outstanding contribution to the analysis of wine and sustainability.

Wine Wars II is one of four books that received this special award and I think it is revealing to consider them together to appreciate the complexity of the sustainability and wine issue.

As I understand it, sustainability is all about the tension between and among seemingly opposite poles and the need to navigate the force fields thus created.

First, Sustainability is a global concern (think United Nations Sustainable Development goals), but it is a battle that must be fought one locality at a time. Think global, act local. (One scholar coined the term “glocal” to describe this situation, but I avoid it since it sounds like my cat coughing up a hairball.)

The first pair of books on the award list, Manifeste Chateau Cheval Blanc and  Agroecologie: Quatre Saisons du domaine de l’Apocolypse  examine the problem from the local level in France and Greece respectively, giving us a look at how global principles are translated into local practice, with attention to the specific challenges and opportunities.

Science and business are often seen as opposite sides of the sustainability issue, too, but is this the case? The second pair of books explores this tension in two very different ways. Jamie Goode’s book on Regenerative Viticulture  takes a scientific approach to sustainability, developing a toolkit to be applied thoughtfully to specific situations to make viticulture more truly sustainable.

If business and its profit motives are the enemies of sustainability, what can drive wine firms to adopt the tools and follow the examples that the first three books listed here provide? My answer in Wine Wars II is risk. Adopting sustainable practices may come at a cost, but not taking action is costly too and wine businesses are increasingly being forced to confront those costs both in the field and on their business accounts.

Climate change creates material risks that businesses must report and attempt to manage and it is informative to see what wine sector businesses see as the most important risks and what they are doing to address them.

But there is most to consider from the economic perspective. Sensible practices in the vineyard and cellar are only truly sustainable if they are also economically sustainable. The final section of Wine Wars II explores wine’s “triple crisis” (environment, economy, identity) and tries to help readers think clearly about the complicated issues the wine industry faces today.

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Many thanks to Edouard Cointreau and the Gourmand awards team, both for the specific recognition for Wine Wars II and for their efforts to draw attention to the many faces of wine and sustainability. Congratulations and thanks, too, to Pierre Ly who accepted the award certificate for Wine Wars II. Adventures on the China Wine Trail, by Pierre Ly and Cynthia Howson, also received a Gourmand award at the ceremony.

Back to the Future with Dry Rosé Wine?

May 23, 2023 By in wine, wine history, wine magazines, wine markets Leave a comment

More than five years ago, I wrote in these pages that “dry rosés are increasing in popularity not only among open-minded wine drinkers but also among California winemakers.”

If I could write these words today they’d make me look like a pretty savvy wine economist. Dry rosé wines have experienced a boom in recent years and not everyone was convinced back in 2018 that the pink wave was real.

But I didn’t write this sentence. Mark Bittman did in an article titled “The Perfect Summer Wine?” that appeared in the August 1998 issue of Cook’s Illustrated magazine. (This issue sort of fell into our hands when Sue found it in the Little Free Library down the street. Someone in the neighborhood must be cleaning magazines out of the basement.)

Tutti Fruity?

You might be surprised to know that dry rosé was fashionable back in 1998, but actually that’s not the point that Bittman makes in this article. You see way back in 1993, Bittman’s tasting panel found lots of dry rosés that pleased them. But by 1998 things were going downhill, he writes. Too many of the wines they tasted were sweet, not dry. “Tutti fruity” one tasting note reads. “Just drier than black cherry soda, not unlike it,” says another.

That’s not to say that Bittman’s team couldn’t find delicioous dry rosés for the 1998 tasting. The thing that struck them was that most of them came from France and only a few from California. Three out of four of the “not recommended” wines were California products. Not exactly a Judgement of Paris result.

All but one of the “recommended” and “highly recommended” wines came from France. The sole California selection? Heitz Cellars Napa Valley Grignolino Rosé!

The Curse of the White Zinfandel?

I wonder if this was a “white Zin” effect? There was a time when sweetish pink California wines were very popular and the leader of the pack was White Zinfandel. Do you suppose that the popularity of that style of wine influenced Calfifornia rosé wines generally the way that the success of Kendall-Jackson Private Reserve Chandronnay influenced a lot of California Chardonnay producers?

The sweet/dry cleavage isn’t the only one that Bittman’s article highlights. There is also pale and dark to consider.

The top rosé wine, according to the tasting panel, was the same in both 1993 and 1998: Chateau de Trinquevedel Tavel. Younger readers may wonder in what part of Provence is Tavel found? This is a trick question because Tavel is in the Rhone valley and the wines are dark and full-bodied. I have always thought of them, in my simplistic way, as pink wines for red wine drinkers. Pale Provencal wines (like the #2 wine in 1998: Domaine de la Gautiere en Provence) are, by contast, pinks that appeal a bit more to those who like white wine.

Delightful and Affordable

The wines were not especially cheap in 1998: $15 for the Tavel and $8 for Provence. That is much more than Beringer White Zin in those days, but worth every penny, Bittman assures us, and I am sure he was right. The most expensive wine reviewed cost $22 in 1998 prices, which was a lot for a rosé back then. But what a wine: Domaine Tempier Bandol 1996.

Dry rosé is back with the French in the vanguard. But darker rosés like the Tavel are hard to find (Tavel wines are very hard in my local market). Everyone tells me that consumers strongly prefer pale pink to dark pink, even though the experts say that color and hue don’t determine flavor and aroma. If the conventional wisdom is correct in this case, then I feel a certain loss. Those Tavel rosés and wines like them deserve more attention.

Mark Bittman concluded his 1998 Cook’s Illustrated article saying

I wish I could write, as I did in 1993, that this was a “group of delightful, affordable wines.” But there are some delightful and affordable wines in the group; you just have to be a little more picky than you did a few years ago.

I wonder what he’d write today? Certainly there are many more rosé wines and a lot of them are surely delightful (how affordable they are is a matter of judgement I leave to you, but the majority seem affordable by the standards of the 1998 tasting). You probably still need to be a bit picky, however, to find what you want.

Wine Book Review: On the Wine Trail with Lonely Planet

May 16, 2023 By in book reviews, wine, wine tourism Leave a comment

Lonely Planet Wine Trails 2 (Lonely Planet Food, 2023).

The Lonely Planet Guide folks have released a new guide to global wine trails. The big book (320 pages, 2.4 pounds) lays out itineraries for 52 potential weekend wine country visits. It is a colorful book, full of maps and photos, and worthy of consideration if you are planning trips, interested in how wine tourism has developed, or just want to make imaginary vineyard visits.

Each chapter is organized according to a set structure, starting with an overview and map followed by brief profiles of six or seven wineries (a reasonable number to think about for a weekend trip). Accommodations?  A couple of options are provided along with three dining choices and some ideas for non-wine things to do. Just enough to get you started.

Sue and I have visited many of these regions and, in general, I’d give the Lonely Planet itineraries solid marks. They might not always be the wineries we would choose to visit or the hotels and restaurants we’d pick, but they would certainly steer a first-time visitor in good directions. This is not a surprise, since the wine tourism chapters were written by an international team of experts.

Creating a big book like this is an exercise in choice. What do you put in? What do you leave out? You can’t possibly include everything in 300+ pages. Something has to give! This fact became apparently to me some years ago when I was asked to edit a book for a New York Times series. I was given the entire 20th century of New York Times content (all 100 years) and tasked with telling the story of globalization. What I learned was that you have to begin with a story and build around that, which is sort of a top-down approach that prioritizes the narrative. A bottom-up approach, which relies upon the facts to form their own images, is fiendishly difficult to pull off.

The decisions when looking at wine tourism begin with the question of what regions to include. Fifty-two is a big number, but there are many more wine trails around the world. When a French wine periodical published a list of the 35 best wine tourism destinations back in 2012, they found that 29 of them were in France. Zut alors! That’s not much for the rest of the wine world.

The Lonely Planet guide lists eight French itineraries including the “greatest hits” of Burgundy, Bordeaux, and Champagne. Italy and Spain get seven entries each, including the most famous and most-visited regions.  So far just as you might expect. But while Australia has seven entries, big-name Barrossa is not one of them. And Napa is not anywhere on the USA list, which takes you from the Finger Lakes of New York, through Pennsylvania wine country, to Grand Valley, Colorado, and on to Walla Walla, the Willamette Valley, Sonoma, and Santa Ynez.

Other parts of the wine world receive less space. Argentina, Canada, Chile, England, Georgia, Germany, Greece, Lebanon, Portugal, Romania, and Slovenia get one entry each. New Zealand and South Africa get two entries each.

At first this inconsistent treatment of famous regions versus the rest bothered me, but I’ve decided that it is probably OK within the context of this book. Reading about the charms of Colorado wine country, for example, might encourage someone to look beyond the big name appellations when visiting France or Italy. And that would be a good thing.

This method of mixing the famous with the lesser-known continues within the chapters in terms of the winery choices presented, accommodation options, and dining recommendations. Some of the choices left me scratching my head (why list hotels and restaurants in Portland, for example, when there are so many good choices in the Willamette Valley wine country itself?), but in general I’ve decided that the Lonely Planet guide is quite useful. It gives readers the basics and invites them to explore.

Readers who don’t go beyond the recommendations here will have a good time. Curious types who use this as a springboard to dive deeper into the wine tourism pool will have even more fun because when it comes to wine the wines, wineries, restaurants, etc. that  you discover yourself are often the most satisfying.

America’s Wine Regions: Re-Imagining Colorado

May 2, 2023 By in emerging wine regions, wine, wine markets Leave a comment

What do you think of when you think of Colorado? Chances are that Colorado wine isn’t the first image that comes to mind, but it should be somewhere on your radar screen. Wine is both old and new in this Rocky Mountain state.

Peaks and Valleys

Wine was first produced in 1890 from grapes grown on 60 acres of vineyard and orchard land on Rapid Creek above Palisade along the Colorado River. The decades since these first wines were made have been full of peaks and valleys for Colorado wine and Sue and I have had sort of a rocky road experience ourselves with these wines.

We’ve had several chances to taste Colorado wines over the years, especially when I spoke at the state’s annual VinCO Conference in 2018. While we’ve been impressed by some of the wines, we were disappointed by others.

Peaks and valleys. This uneven experience is a problem because you seldom get a second chance to make a first impression when people taste your wine. But it is also understandable. Honestly, I don’t know any wine region that doesn’t have its share of peaks and valleys.

Climbing to the Heights

It is also understandable because, although the Colorado wine industry is surprisingly old, it is also unexpectedly young. You see, Colorado citizens embraced Prohibition even before the national policy was enacted and the vines were ripped out more than 100 years ago. Wine really didn’t restore its foothold in Colorado until the 1970s (Warren Winniarski, of Judgment of Paris fame, made some of those early wines). The industry has charted an upward path since then, but the road has remained rocky.

Sue and I were delighted when offered the opportunity to taste Colorado wines from The Ordinary Fellow winery, a project of the winemaker Ben Parsons and located in the old United Fruit Growers COOP peach packing shed in Palisade. I don’t know Parsons personally, but his career path reminds me of Randall Grahm. Grahm is a brilliant brand-builder who is also a committed terroirist. Both land and brand, if you know what I mean. I think Parsons might be the same.

Parsons achieved brand-building fame with The  Infinite Monkey Theorem winery. He started out making wine in a quonset hut in Denver, far from the vineyards but up close to the urban customer base. He set out to be different, which drew him to keg wine and then to cans. Infinite Monkey Theorem became a canned wine phenomenon to such a degree that at one point a second winery was opened in Austin. Parsons and the Infinite Monkey Theorem brand were way ahead of the curve in terms of cans and creating an image and environment that appeals to younger consumers.

Parsons left Infinite Monkey Theorem in 2019 to found The Ordinary Fellow (named for a favorite pub in England), making wine in Palisade from grapes grown on two high-elevation vineyards in southwest Colorado.

More Than Mile High

We tasted three of the Colorado wines. Our favorite was a 2021 Riesling ($18) from the Box Bar vineyard, elevation 6200 feet. It had intense Riesling character and developed nicely in the glass with dinner. We also enjoyed the 2021 Cabernet Sauvignon ($25) from the same vineyard. Can you taste high elevation? I wonder. This wine reminded me of some high-elevation Malbecs from Salta in Argentina. The acidity really lifted the and balanced the tannins. Was it really an elevation effect? Probably the power of suggestion, but very interesting.

The 2021 Pinot Noir ($25) from the 6800-foot Hawk’s Nest vineyard struck us as a work in progress, but one we’d be interested to follow in the years to come. What a beautiful light color and nice nose! But Sue thought it tasted more like a Grenache than Pinot Noir, which is not necessarily a bad thing. Me? I’m just amazed that Pinot Noir can be grown in Colorado, but I guess I need to reimagine what’s possible in Colorado. Overall I would say these wines are a “peak” experience for sure. I hope we have a chance to visit the winery in Palisade somewhere down the road.

Parons produces about 2500 cases of wine these days with plans to grow to 5000 cases. He’s working hard to develop the vineyards and to make wine that reflects their particular terroir.

Rocky Road Ahead?

Colorado has 163 wineries according to Wine Business Monthly’s annual survey, which puts it just ahead of Missouri and just behind of North Carolina (two important wine producers) on the list. A WineAmerica economic impact study suggests wine is an important driver of jobs and income.

I asked my friend Doug Caskey, who is executive director of the Colorado Wine Industry Development Board, about the road ahead for the state’s wine industry and he provided a very realistic assessment. On the plus side, innovation is rising, including new sparkling wines that expand the state’s wine menu. But scale (and therefore economies of scale) is limited by several factors including water availability, the risk of severe winter weather, and the cost of vineyard lands.

Colorado recently expanded wine sales from specialized shops to include supermarkets and convenience stores and this change introduces a big question mark for Colorado wines. On one hand, wine will be more readily available for the state’s shoppers, which is likely to increase wine sales. But will it increase Colorado wine sales, or will those supermarket shelves be filled with bigger-volume wines from California and elsewhere? Lots of uncertainty.

Will the rising tide lift all wine boats? Maybe. Supermarkets like to demonstrate their commitment to local products and producers. What could be more local in Colorado than Colorado wine? However, based on what we’ve seen in other states, it’s a tough problem to solve.

Sue and I are glad we had this opportunity to revisit Colorado wine and look forward to learning more about this state’s evolving wine industry in the future.

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As you probably already guessed, The Ordinary Fellow wine isn’t ordinary at all. Its exceptionalism begins with the colorful labels, which are actually more complicated and interactive than they appear in the photos. There are two parts to the label. The first is a very colorful inner label that reminds me a little of the Beatles’ “Yellow Submarine” type of art, then a plain white outer label that rotates to reveal different aspects of the inner art. Kinda psychedelic! Not ordinary at all.

Co(u)ltura Conegliano Valdobbiadene: Festival of Wine Literature

April 25, 2023 By in Italian wine, Shameless Self-Promotion, wine, wine festivals Leave a comment

Sue and I are off to Italy in a few days to be part of an ambitious festival of wine literature sponsored by the Conegliano Valdobbiadene Prosecco Superiore consortium in collaboration with Alessandro Torcoli, director of Civilta del Bere.   Here is a link to the festival website coulturafestival.it 

The setting is the fantastic Castello San Salvatore in Susegana. The program features conversations with  noteworthy wine writers interwoven with focused wine masterclasses. All the senses will be stimulated, especially the imagination.

My contribution will take the form of a conversation with wine writer Susan Gordon about my new book Wine Wars II: The global battle for the soul of wine. followed by a book signing opportunity.  We hope to see our Italian friends at the event.

Here is an excerpt from the (auto-translated) press release with the details.

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Wine is an integral part of our culture; an ancient drink whose production over the millennia has been improved thanks to the study, experimentation and research of man. The cultivation of the vine has forged landscapes, created local cultures, defined communities and projected Italy into the world. During Co(u)ltura Conegliano Valdobbiadene guests will be welcomed in a space designed to allow them to deepen the many aspects that the wine world offers to its enthusiasts and to the increasingly numerous curious.

“With Co(u)ltura Conegliano Valdobbiadene we want to propose a wider and more engaging way of proposing our product” announces Elvira Bortolomiol president of the Protection Consortium “It is an event inspired by the presentation of the last vintage of Conegliano Valdobbiadene Prosecco Superiore DOCG to lead the visitor on an exciting journey into the world of wine. Through meetings with authors and their books, with the producers of Conegliano Valdobbiadene, with images, which we will use in various ways to tell the many facets, visitors will have the opportunity to be surprised by the many insights and entertainment that we are sure will involve them “.

“Co(u)ltura is an extraordinary opportunity to experience wine in its best dimension, the cultural one” comments Alessandro Torcoli, director of Civiltà del bere. “It is the first time that a Consortium has decided to go beyond the promotional dimension of its wine to give back to the public opportunities for authorial reflection, thanks to the meeting with writers, journalists and essayists of clear fame. Visitors will be able to alternate tasting sessions with presentations of books on food and wine, to come out enriched not only in the senses, but also in the intellect. On the other hand, we are convinced that the best weapon against prohibitionist campaigns is that of culture, which teaches to drink with the head”.

Visitors and wine lovers will be able to spend an entire weekend meeting with the most authoritative names in Italian oenology such as the agronomist Attilio Scienza and Luigi Moio, president of the OIV; the most famous critics such as Daniele Cernilli. We will not neglect the marketing aspects with Slwaska Scarso nor the most evocative names and faces of the sector such as Sandro Boscaini. For those who want a complete overview of the product, its origin, its territory, it will be possible to register for in-depth masterclasses on Conegliano Valdobbiadene, also proposed “in combination” with a book that in various ways will address the territory: from the verses of Andrea Zanzotto to the studies on soils of the Director of the Consortium Diego Tomasi. The journalist and expert on the global wine market, Mike Veseth, will also be involved who, interviewed by Susan Gordon, will broaden our horizons beyond national borders. Finally, Gad Lerner will talk with Alberto Grandi about the origin of the denominations.

The books and their authors together with experts in the sector, the producers of Conegliano Valdobbiadene Prosecco Superiore DOCG will be the expedient to make Italian and foreign consumers discover that wine is not just a product that we consume but cultural expression in a broad sense, passion, effort, joy, sharing. For this reason, the event is also enriched by two exhibitions, one dedicated to advertising posters in the sector that tells how wine was promoted until the first half of the ‘900 and an immersive exhibition that will unfold in some rooms of the Castle from 21 pm on Saturday 6 May, in which the visitor will be literally immersed in the rows and stories of the territory.

Finally, the protagonist of the evening of Saturday 6 May will be the video mapping projected in the magnificent courtyard of the San Salvatore Castle, for a story of the history of the Protection Consortium, which winds between enchanted of the past and dream of the future.

For the complete program, directions on how to reach and how to book masterclasses visit www. coulturafestival.it

Unsustainable? Anatomy of California Vineyard Economics

April 18, 2023 By in economic crisis, Economic impact, wine, wine markets 9 Comments

The April 2023 “Vineyard Issue” of Wine Business Monthly features articles that address many different important winegrower issues. I find W. Blake Gray’s analysis of “Prices Don’t Pencil Out for Growers Who Saw Production Costs Double” particularly interesting because it deals with a problem that I wrote about earlier this year in a Wine Economist column titled “Margins? What Margins? The Big Squeeze in Winegrowing 2023.”

Red Ink Harvest

The Wine Economist column was provoked by a conversation with some California growers at this year’s Unified Wine & Grape Symposium and connected the dots linking their observations with Vinpro data presented a few weeks earlier for South Africa. Only 9 percent of South African winegrowers earn a sustainable return on their vineyard investment.  A little more than half break even or earn small nominal profits, but not enough to sustain continuing investment. And almost 40 percent reported losses. And the margin gap is getting wider.

My California grower friends said their situation was not much different from the South Africans and, indeed, this is a problem I have seen around the world, although not typically backed by the sort of data that Vinpro collects for the South African industry.

The two simple strategies to claw back margins are to reduce yields to try to raise quality and therefore price or to reduce unit cost by increasing yields. South African growers have found it difficult to raise prices enough to make the first strategy work, so many are focusing on higher yields. But it is not as simple as that, the California growers told me, because sometimes buyers won’t allow higher yields and, in any case, some older vineyards just aren’t set up to make high yields possible.

Losing in Lodi

W. Blake Gray’s article digs deeper into the California situation, specifically for District 11, the San Joaquin Valley North, which includes Lodi. He quotes Aaron Lange of Lange Twins Family Winery and Vineyards in Lodi, for example, who explains that average grape prices are lower now than they were 25 years ago (despite higher costs throughout the production chain). Lodi Cabernet Sauvignon, for example, sold for an average of $695 per ton in 2022 according to the UDSA grape crush report. It sold for an average of $794 in 1997. The figures for Chardonnay grapes are $627 in 2022 versus $774 in 1997. That, my friends, is a big squeeze.

Is it possible to increase yields enough to break out of the big squeeze? Gray provides data from a 2021 UC/Davis study of the District 11 situation that suggests that higher yields can sometimes, but not always, solve the problem. At a price of $650 per ton (which is close to the average current Chardonnay and Cabernet prices), for example, the Davis study calculates a $156 per acre profit at 12 tons per ace and a $780 per acre product at a yield of 13 tons, but losses at lower per-acre yields.

The situation is only a little different at a price of $750 per ton. Profits ($633 per acre) appear at a yield of 11 tons per acre, rising to $2080 at a yield of 13 tons. But yields below 11 tons per acre still generate red ink even with the higher price.

Lower prices make things much worse. At a price of $550 per ton, no level of yield between 7 tons and 13 tons generates a profit. It’s red ink all the way down.

Unsustainable Yields

These data and reports make me wonder if winegrape growing is economically sustainable for many producers in District 11 and similar regions and these doubts are heightened by Gray’s interview with Jeff Bitter, the President of Allied Grape Growers (and a grower himself). Bitter notes that the economics of winegrape growing have made it difficult or impossible to focus solely on grape production.

Why continue to farm grapes? Some farm winegrapes because it is what they want to do (a “lifestyle” choice), Bitter suggests at one point, or because the alternatives are unattractive. There are a lot of factors that define the situation, including market conditions in different regions (Central Valley, Central Coast, North Coast) and farm size. There is money to be made in winegrapes under the right circumstances, but there are plenty of losses, too, and it is easy to understand why generational transitiions among growers are often in doubt.

When we talk about sustainable winegrowing, we usually focus on the environmental impacts, but Gray’s article suggests that we need to take the issue of economic sustainably more seriously, too.

Thanks to Wine Business Monthly for all the great articles in this issue and to W. Blake Gray for his focused report on the vineyard margin problem and the economic issues facing growers generally.

America’s Wine Regions: Mainly Mendocino

April 11, 2023 By in emerging wine regions, wine, wine markets 1 Comment

The American wine scene is incredibly deep and wide. There are thousands of wineries (more than 11,000 in 2023, according to Wine Business Monthly) producing tens of thousands of different wines with prices ranging from two bucks to several hundred dollars.  Wine is produced in every state and the District of Columbia, too.

Spoiled for Choice

This explosion of American wine is noteworthy for many reasons, especially in the context of history. Don’t forget that commercial sales of wine were illegal during Prohibition and are still heavily taxed,  regulated, and often discouraged in many parts of the country.

The widespread production of wine is also challenged by what the economist Robert H. Frank called The Winner-Take-All Society in his book of the same name. When consumers have a choice (and wine consumers have an incredible abundance of choice), it is natural for them to begin to look for the best choice and to focus on that once it is identified. (Wine critic numerical scores reinforce this process, of course). Add in the band-wagon effect as transmitted through the internet (think Yelp rankings of winery visits) and pretty sonon attention is firmly focused on a relatively small number of favorites with most of the rest left behind.

It was easy to see the Winner-Take-All effect when Frank’s book was published in 1995. It is easy to see it now, too, and it represents one of several powerful forces for consolidation in the wine industry. There may be more than 11,000 wineries all across America, but most of the wine is made by a small number of large wineries in California. The winner doesn’t take it all in terms of market share, but lots of smaller wineries struggle a bit for market traction and attention.

Think Local. Drink Local.

Sue and I try to seek out local wine producers when we travel and we are fascinated by what we discover. A recent Wine Economist column on Arizona Wine Revisited has inspired us to highlight Mendocino County, California. It isn’t a new wine region — quite the opposite! But, sitting just north of the bright lights shining on the Napa and Sonoma valleys, Mendocino has suffered from the downside of the winner-take-all situation.

Jancis Robinson and Linda Murphy summed up one part of the Mendocino story in their 2013 book on American Wine. 

Only in the last two decades has Mendocino County won acclaim for its wines; previously it was known for selling its grapes outside the county. In the early 1900s Mendocino didn’t have railroads or river systems with which to deliver finished wines to San Francisco, where they could be sold. So growers transported their fruit by wagon to the Italian Swiss Colony co-op in Asti (Sonoma County), where they were ” lost” in large, inexpensive blends. … Those discouraging days are finally over.

Some of those early Italian Swiss Colony wines cited Sonoma, Napa, and Mendocino (great billing!) as the source of the grapes. But that, I think, was before the advent of American Viticultural Areas and their regulations. Soon these wines were designated “California” and Mendocino sort of fell off both the label and the consumer radar. The wine wars became brand wars and brand Mendocino struggled.

But, as American Wine notes, Mendocino is back. Although lots of Mendo grapes are still “exported” to other parts of California to make popular wines, home-grown producers are getting recognition, too.

Sue and I sampled wines from three Mendocino producers during a pair of “Mendocino weeks” at our house: Husch Vineyards, Graziano Family of Wines, and Ettore Winery. Although this only scratches the surface of Mendocino wine, these wines show some of the many faces of the region.

Both Sides Now: Husch Vineyards.

Husch Vineyards dates from 1968 and became the first bonded winery in Mendocino’s Anderson Valley in 1971. The Oswald family purchased the operation in 1979 and it has stayed in the family ever since.

Husch wines show two distinctly different faces of Mendocino County. The Anderson Valley’s cooler climate yields elegant Pinot Noir, Chardonnay, and a Dry Gewurtztraminer with a loyal following. Warmer inland vineyards produce Cabernet Sauvignon, Merlot, Old Vine Zinfandel, and Chenin Blanc grapes among others.

The wines are impressive, but the Dry Gewurtztraminer, off-dry Chenin Blanc, and Old Vines Heritage red wine blend of Petite Sirah, Zinfandel, and Carignane from the historic Garzini Ranch vineyard, are special favorites. We are fans.

All in the Family: Graziano Family of Wines

If Husch Vineyards is old by contemporary California standards, Graziano, founded in 1918, is positively historic and makes a point to honor its history in its wines. After 70 years as  growers, Greg Graziano started making wine, too, in 1988. I think he realized his grapes were too good to let them disappear into other wineries’ big vats. The wine family today includes four labels: Saint Gregory, Monte Volpe, Enotria, and Graziano.

The Saint Gregory wines exploit cooler vineyard sites and include Pinot Noir and Pinot Meunier. The Graziano wines, on the other hand, highlight the old vines planted by the family in warmer spots, including the California classic trinity of Zinfandel, Petite Sirah, and Carignane, plus a lovely Chenin Blanc.

The Monte Volpe and Enotria labels honor the family’s Italian heritage with wines made from traditional Italian grape varieties such as Sangiovese, Vermentino, Negroamaro, and Aglianico (Monte Volpe) and Arneis, Dolcetto, and Barbera (Enotria).

Obviously, the wines are very different from one another, but they share a certain undeniable family resemblance that I characterize as “Italian sensibility.” What do I mean by that? Well, Italian wines are just different, with their lifted acidity and the way they call for food to pair with them. Greg Graziano is the dean of Mendocino winemakers and I think the winery and its distinctive sensibility is likely to stay “all in the family” for decades to come.

Fresh Faces: The Ettore Winery

Mendocino continues to attract and inspire winemakers. Ettore Biraghi is one of the fresh faces on the scene. Born in Lombardy, Ettore began his winemaking career in the Italian-speaking Swiss canton of Ticino. He owns, with business partner Franco Bruni, Tenuta Agricola Luigina winery in Stabio, Switzerland. Ettore visited California in 2015 to learn about its vineyard regions and discovered Mendocino. His winery opened in 2019 and the first organic wines were released a year later.

We have tasted two of Ettore’s wines. The Cabernet Sauvignon, from Sanel Valley Vineyards vines of 21 to 29 years of age, would compete very well in a lineup with Napa Valley Cabs of twice the price (Mendocino wines in general are very good value  for quality). We also sampled the Chardonnay “Zero,” which is made without added sulfites using a process called “Purovino.” I thought it was a bit weird and didn’t much remind me of Chardonnay, but Sue thought it was interesting. More research required.

Mendocino has a long history and, I think, a bright future. As noted above, we have just scratched the surface, but it is a start and we encourage you to pick up where we left off.

Watch for a series of occasional columns about America’s wine regions. Colorado and Michigan are next on our agenda.

Book Review: Wine Education for a Diverse Wine World

April 4, 2023 By in book reviews, Masters of Wine, wine Leave a comment

A comprehensive guide to wine education for a diverse wine world: “Leary’s Global Wineology” reviewed by Pierre Ly.

In “Leary’s Global Wineology: A Guide to Wine Education, Mentorships, & Scholarships” (Hibiscus Panama, S.A. 2022), Charlie Leary presents a clear, comprehensive resource for anyone interested in pursuing wine education from beginner to expert levels. The book is well-organized and covers programs for every budget and purpose, in both academic and non-academic settings, and in many countries.

The brief introduction defines wine studies and provides informative facts and figures on different types of wine jobs, and average salaries in each. The “Big Five” chapter offers the most detailed program descriptions because it is dedicated to the most famous and highly sought-after trade certifications, like The Court of Master Sommeliers (CMS) and the Wine and Spirit Education Trust (WSET). Beyond these, throughout the book, I found the presentation of each program concise yet detailed enough for readers to assess content, rigor and learning outcomes, so they can decide whether a course is worth exploring further. Many readers, especially those with a more casual interest or professionals on a budget, will be interested in chapter 7, which focuses on free online programs. The author even suggests excellent curriculum ideas to take these courses in an organized way as if you were in school.

While the comprehensive coverage of all types of wine programs alone makes the book worth buying, I was impressed with the author’s treatment of diversity, equity and inclusion in wine education, to discuss issues like bias, racism and sexism. This is important because criticisms of the insularity and lack of diverse representation in the wine industry have gained more visibility in recent years. I appreciated that the author did not include this as part of program descriptions, but instead used it as a framework, encouraging readers to “be aware of any program’s historical background and biases.” These are systemic issues that are not limited to problems affecting a single program, such as the recent CMS scandals, which the author also discusses.

I would recommend that users of this guide take the time to look at chapters 1, 2 and 9, before using the table of contents to explore the specific programs they are interested in. Chapter 1’s history of wine studies offers a concise, yet thorough comparison of different wine education providers’ backgrounds and agendas, as well as reflections on the insularity of the wine trade and its continued lack of diverse representation. As the author notes, this is not to take away from the high value-added of their programs, but to help readers understand the issues they might face if they enter them. Interested readers can go deeper by exploring Leary’s references like wine writers Elaine Chukan Brown and Julia Coney.

Both chapter 2’s presentation of scholarships, and chapter 9’s coverage of mentorship programs, include several organizations focused on increasing BIPOC and women’s representation in the industry, like Bâtonnage, Vinequity, and Wine Unify. Finally, chapter 9 is addressed to wine education professionals as a starting point to reflect on their work to become more inclusive, and to incorporate more discussion of environmental and social issues in their curricula. For the past decade, I have been teaching a college course that Mike Veseth invented, The Idea of Wine, that invites students not just to know more about the product, but also to see how wine can help us understand big picture societal questions. It is aimed at college seniors, most of whom come with almost zero knowledge of wine. While students are excited about vineyard and wine production knowledge, what catches their attention in the end is the bigger picture. In chapter 9, Leary discusses wine’s connection to topics like climate change, the slave trade, fair labor practices and racism, and suggests they could be incorporated in wine education.

Chapter 4’s coverage of other international programs is excellent, if necessarily limited so as not to make the book over a thousand pages long. Given the importance of China (a very important market for WSET), more programs could be included. To make the book more useful for Chinese readers, it would be useful to mention other options, notably university degrees offered by the School of Enology at Northwest Agriculture and Forestry University near Xi’an, and at the University of Ningxia. The School of Enology (which, besides viticulture and enology, offers wine appreciation and wine business courses) is important enough to be included among degree programs in chapter 5 or 6.

The book is written in English, so it includes more programs taught in that language. However, the author did include some programs in other languages, but they are difficult to locate. It would be helpful if future editions of the book could include a list of non-English language programs, organized by language and page number, either at the beginning of the book or in an appendix. Additionally, it would be great if there was interest in translating the book to cater to local interests. Finally, while the issue of program costs is discussed at length in chapter 2 (which is about scholarships), it would be beneficial to include a column in program summary tables throughout the book that shows the prices of the programs.

Overall, Leary’s Global Wineology provides not only a comprehensive guide to just about anyone interested in wine education, from those seeking basic consumer knowledge, to advanced wine professionals looking to boost their credentials. Perhaps any knowledgeable person could have compiled such a list. But what makes the book stand out is the author’s thought-provoking coverage of wine education’s current and future, and its critical eye toward areas for growth, making the book relevant to wine educators as well. Highly recommended for wine enthusiasts and professionals alike.

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Pierre Ly is Professor of International Political Economy at the University of Puget Sound and author, with Cynthia Howson, of Adventures on the China Wine Trail.