Sunday, October 28, 2007

Chateau Ste Michelle

I gave a brief talk to a university group at Chateau Ste Michelle in Woodinville, Washington yesterday and it gave me a chance to think at bit about the Washington wine industry in general, now with more than 500 wineries and growing, and Chateau Ste Michelle (CSM) in particular.

Sue and I were fortunate to be able to spend a couple hours in the afternoon with CSM Enologist David Rosenthal (pictured here) , who is a 2001 marine biology graduate of the university. He's worked at Mondavi as a chemist and at Oregon and Australia wineries and he now helps make the white wines at CSM. They produce about 400,000 cases of Chardonnay and 750,000 cases of Riesling in addition to smaller amounts of other white varietals. It is quite an operation and David was nice enough to answer all of our questions and take us through the cellar room, sampling wines starting from unfermented juice that had just arrived from Eastern Washington on through the various stages of fermentation and aging. I learned a lot -- thanks, David.

I've read that CSM uses its large scale wisely, treating size as a resource that permits experimentation and diversity, and I could see this pretty consistently through our tour with David. CSM's scale is tailored to give its winemakers a great deal of choice when it comes to blending their high volume wines and also to facilitate limited production products, including of course the single vineyard bottlings.

Chateau Ste Michelle is part of Ste Michelle Wine Estates (SMWE), which owns several other Washington brands, including Columbia Crest, Snoqualmie, Domaine Ste. Michelle (sparkling wines), NorthStar (which began as a high end merlot specialist label), Red Diamond, Stimsom Estates Cellars (up-market jug wines), 14 Hands (the manditory critter wine -- the critter on the label is a horse that stands 14 hands high) and the boutique Walla Walla producer Spring Valley Vineyard. If you've been reading this blog you know how important brands are in the wine market today and SMWE's strategy reminds me of the old Robert Mondavi company -- to have competitive brands from the popular premium shelf on up to the icon level, leaving the low margin bulk wine market (the bottom shelf) to Gallo, Yellowtale and Charles Shaw. CSM and Columbia Crest are the leading brands, with 3 million cases produced between them.

Although everyone associates CSM with Washington, the company's reach is much broader. Other brands in their stable include Erath (Oregon), Villa Mt. Eden and Conn Creek (Napa Valley) and Distant Bay (Monterey). They are the exclusive U.S. distributors of Antinori wines and have partnerships with both the Antinori family (to produce Col Solare, Washington's answer to Opus One) and, with the Mosel's famous winemaker Ernst Loosen (to make Eroica, an exceptional Riesling). SMWE is the largest producer of Riesling wines in the U.S. and possibly in the world! Together with the Antinoris, SMWE recently purchased Stag's Leap Cellars in Napa Valley, one America's most distinguished wineries.

In other words, this is big business, both in terms of volume and quality. Altogehter SMWE's brands produce 4 million cases a year, which is about two-thirds of all Washington wine, and it is a correspondingly huge influence on the whole industry here. Of course, Washington is still tiny, in quantity terms, compared to California. People say that Gallo produces about 70 million cases all by itself. (Since Gallo is family-owned, it doesn't report as much data as publicly-traded wine producers do, so we have to guess what's going on in the big warehouses in Modesto.)

SMWE makes a lot of very good wine, which is perhaps more important that quantity in today's market. SMWE's brands account for the largest number of Wine Spectator 90+ wines (and the most total top 100 wines) of any producer in the world. It is an interesting fact that Washington doesn't compete at all at the very bottom rung of wine ladder -- the very inexpensive bulk wines that account for much of the total volume in today's market. You know what I am talking about -- Two Buck Chuck and the lesser wines that make that brand look so good. Of all the New World wine regions, only Washington and New Zealand have been able to build a wine industry from the popular premium level up.

But it makes sense: Washington cannot hope to compete with California's Central Valley producers when it comes to cost-sensitive bulk wines, so it doesn't try. New Zealand is in the same position with respect to Australia. In both cases, I believe, this actually works to the smaller, higher-cost producer's ultimate benefit, since all of the focus is on quality and on the growing upper-tier of the market.

Tuesday, October 16, 2007

Chateau Al Gore

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

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

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

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

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

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

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

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

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

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

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

Sunday, October 14, 2007

The Sense of Wine

People often ask me why I write about wine and I usually say that it is hard not to want to know more about wine because it’s just so darn interesting. I then admit a secondary motive: it’s a good market for me. I think there are many people who would not read a book about economics or globalization who might read one about wine economics or wine globalization because they find wine, well, just so darn interesting.

This leads to the obvious question: what is it about wine that fascinates? It is a simple product, after all, just fermented grape juice. Been around for ages. What's the big deal? For that question I have a simple answer: wine is sensuous and we live in times when sensuality is much sought after.

The act of drinking wine famously involves all our physical senses. To appreciate wine we have to admire the beautiful color (sight), breathe in the aroma (smell), appreciate its texture (touch) and flavors (taste). Sound is the only sense missing from list, which we remedy by touching glasses in a toast. Cheers!

But wine’s sensuality is more than physical. The five physical senses are just the beginning. Wine fascinates because it stimulates to our sense of history, for example, which connects us to people in the past and makes us think about the future.

Wine appeals to our sense of place, too, since it is something that we associate with a particular time and location, often with more meaning and precision than other products of daily consumption.

Wine is a natural product, its variations arising from forces beyond human control. It can also be a personal product, revealing a particular winemaker’s artful expression or a wine drinkers sense of taste.

Wine appeals to our sense of wonder, since we never really know what is inside the bottle until we open it, and our sense of humor, because we are so often surprised by what we taste. Importantly, it informs our sense of self. I find that many of my friends express their identities in part through their relationship with wine. My newspaper editor friend David Seago recently told me that “you need a good vocabulary” to appreciate a particular wine, a statement that told me that he was enjoying the interplay of wine, language, and an active imagination, which is a seriously sensual mix. The imagination is after all the most sensuous organ in the body.

In short, wine is a simple product with a complicated social role. We use it to stimulate the senses we value most. No wonder it's so darn interesting.

Sunday, October 7, 2007

Put a Cork in It?

To Cork or Not to Cork: Tradition, Romance, Science and the Battle for the Wine Bottle by George M. Taber. Simon & Schuster, 2007.

Former Time writer and editor George Taber was the only reporter present at the famous 1976 Paris wine tasting where California wines showed that they could compete with the great wines of France. He wrote about this event and its implications is his wonderful 2005 book The Judgment of Paris, which was named best wine book of the year by Decanter magazine.

The 1976 tasting is one of those defining moments, when a great many forces, issues and personalities came together to change the way we think about the world of wine,. This book is about another defining moment, but a completely quotidian one: the moment when you open the bottle. It's something we do every day. That moment also connects us with some powerful personalities and a complex set of scientific, economic and psychological issues, which Taber explains in a way that makes this a wine-nerd book that will be read and enjoyed by a wider audience than just people like you and me. (Admit it, you must be a bit of a wine nerd to be reading this blog.)

There are all sorts of ways to keep wine in and air out of a container: natural corks, composite cork stoppers, screw caps with tin liners, screw caps with plastic liners, plastic corks of many types, elegant glass stoppers and practical soda pop crown caps. And this is only for wine in glass bottles: you can also package wine in aluminum cans, juice boxes, plastic soda bottles and bag-in-box "casks." Sealing the 20 billion bottles of wine that will be produced this year is a $4 billion business.

I learned a lot from this book. There is no best way to seal wine, there are only better ways under different circumstances with different trade-offs. Natural cork-sealed wines age and develop in the bottle, can be "corked" or suffer from TCA contamination. Plastic corks usually won't contaminate the wine, but they don't always seal tightly over time, so the wine can be oxidized after a couple of years. Screw caps are TCA-free, but they, can seal too tightly, with the result that the wine can suffer sulfur reduction, which gives it a rubbery or rotten egg smell, and screw cap wine can fail to develop as it ages. No matter what stopper winemakers use, they can never be sure that the wine they put in will be the wine that you pour out.

You might think that global wine market competition would have produced a "best practice" solution for wine closures, but the market is too complicated and diverse for that. The science may be universal, but the people (both producers and consumers the the middlemen in between) have their own quirks. In France, for example, it is hard to sell a screw top wine, at least for now, because of the strong attachment to tradition. I can appreciate this. I have friends who get great pleasure from the ritual use of elaborate corkscrews. Screwcaps leave them cold.

In Great Britain, on the other hand, it is apparently getting somewhat harder to find a natural cork in a popularly-priced wine because the supermarket buyers, who wield such market power, are strongly biased in favor of plastic and screw top closures. Like many in the business, they have been burned too many times by problems they associate with bad corks. Here in the United States there is some evidence of the market bifurcating, with plastic and screw tops for wines bought for early consumption (under $20) and high quality corks for expensive and age-worthy bottles.

Taber ends his book with an indirect commentary on wine globalization, which is worth noting here given this blog's theme. Finding a solution to the wine closure dilemma is a worldwide problem and the global market competition is forcing the stopper makers to innovate and make better and better closures and forcing winemakers to get better, too, since they can no longer automatically blame any flaws in their wines on bad corks. "Unfettered competition," he writes, "remains a powerful driving force for good."

I think Taber is right but for now I'm just standing here in the basement, looking with suspicion at the wine in my little cellar, trying to guess what is going on beneath the lids. Having read Taber's book, I now know enough to be anxious about each and every bottle!