Monday, October 12, 2009

 

As Mexican Wine Industry Grows Dark Clouds are Looming

 

'Vino-Tourism' by Steve Dryden

 

I’ve been promoting and writing about Mexico’s wine industry for over five years now, and I would like to share some thoughts about that experience with my readers. When I started writing in 2004, about the Baja California wine country via my self-guided wine tour publication The Guadalupe Grapevine, there were seven official wineries in the region of Valle de Guadalupe, Ensenada and Santo Tomas. Today there are nearly 40 official wineries, hundreds of artisan winemakers, and several new wineries in various stages of construction and/or planning.

 

And, the quality of Mexican wines has evolved from drinkable to good, with a handful qualifying as world class.

 

Despite the fact that our wine industry is fighting regulation, quality control, and formulated standards of excellence, the overall quality of Mexican wine is improving vastly. Some local winemakers feel that Mexico is not ready to focus on guidelines that would regulate the overall quality, but would rather have free rein to experiment in more of an artisan fashion.

 

Historically, this artisan option retards growth in quality and hinders positioning on the global market, but it may buy the industry some time to be creative and explore options. For example, a lack of laws regulating wine quality and standards has enabled visionary producers to experiment with traditional and international grape varieties in a variety of regions. In some ways Mexicans are still trying to define their wine industry, find the correct varieties suitable for the region, and develop that certain character that captures the “essence of the terrior.”  In other words, when you drink our wine you’d think, “oh yes, this is good and it’s distinctly Mexican in expression.”

 

As Mexico transitions away from a beer and tequila drinking country towards more wine consumption, the industry has been blessed with a higher demand for wine than wineries can supply. This has led to a boom for many established winemakers who sell entire vintages before they are made, and has eliminated any desire to export their wines to global markets.  Still, with the current economic downturn many wineries are now stuck with last year’s inventory and, for the first time, experiencing reduced sales.

 

Moreover, up until this point in time many Mexican wines have been overpriced (considering the quality) in comparison to wines of similar quality from Chile, Argentina and Spain. Here in Mexico, the law of supply and demand had dictated the pricing.

 

The movement in creating high quality or premium wine began here in the late 1980’s, and it is still in various stages of emergence and evolution.  Mexican vineyards in the Baja California valleys of Guadalupe, San Vicente, Santo Tomas, Redondo, Ojos Negro, Tecate and other regions have the capability to produce superior grapes (when properly managed), comparable to the best grape growing regions in the world.  The limitations in the past for producing premium wine have been a shortage of trained enologists (winemakers), in addition to a lack of modern technology and equipment.  Of course, a prohibitive tax of about 48 percent on each bottle of wine is a major obstacle for economic growth within the industry.

 

An important asset for the modern winemaker here is that Mexico is blessed with some mature, well established vineyards of high quality grapes. Some of these plantings of European vine stocks go back to 1888, 1910, 1939 and the 1940’s. This supply of high quality, mature grapes gives winemakers a jump start in the quest for creating premium wine. Thus, a lack of superior grapes for making quality wine is not a limitation for Mexico.  The hindrances to substantial progress have been high taxation, as well as a lack of quality control standards and trained winemakers.

 

Recent international gold medal awards for wines made from grapes grown in Mexico (processed in the US) confirms this assessment, although many Mexican wines have fared well in international competitions for several years, winning gold and silvers around the world.

 

There are some ten trained enologists working within the Mexican wine industry today. Many are internationally trained (three with PhDs) in countries like France, Italy, Australia, Switzerland, Chile, Argentina, the United States, and Mexico. Furthermore, the younger generation of aspiring winemakers have traveled and studied outside of Mexico, returning to their homeland filled with innovative ideas and techniques.

 

The local UABC, the Autonomous University of Baja California, in Ensenada, recently introduced classes in winemaking and vineyard management, and a small artisan winemaking school in Valle de Guadalupe (La Escuelita) continues to introduce the general population to the art form of creating handmade wines. Several graduates from La Escuelita have become super stars in the local artisan winemaking movement with the creation of excellent wines. Lately several well-known winemakers from California have invested in Baja California vineyards, with plans to make wine here, thus adding to the excitement and recognition of the region. Mexico’s silent revolution in creating premium wine is just beginning.

 

Two important factors will however have major impacts on the future of the Baja California wine industry: a shortage of grapes; and a critical lack of water.

 

In the last few years we’ve seen many new vineyards popping up throughout the region. Total annual wine production (nationally) is still under two million cases per year, mostly due to the grape shortage. For example, last year (2008) there was a serious grape shortage, prices were extremely high per ton of grapes, and many winemakers had to settle for what inferior grapes were leftover. This grape shortage was one factor that sparked a recent trend with local winemakers in buying vineyards in Europe, with the intent of importing the juice back into Mexico for blending.

 

Then we were hit with the economic downturn, creating a decrease in the demand for wine, a global glut of wine/grapes, and reduced pricing of wine and grapes. In comparison, with this last harvest (2009) almost every varietal of grapes were for sale and available to everyone at reduced prices. At this time many serious winemakers are growing their own grapes and managing estate vineyards to ensure a regular supply of premium grapes.

 

The most critical factor for the future of grape growing and winemaking in Mexico is the major lack of water resources. In fact, it may well be the demise of the industry. Last month one of the country’s top hydrologists (water scientists) informed me that in-depth research indicates that there is only about ten years of water left in Valle de Guadalupe. In the meantime, unregulated lot and housing developments continue and illegal water wells are being dug everyday in the valley. This threatens the economic boom gained from the wine industry because this valley produces the largest percentage of wine grapes for the country, and without water it won’t survive.

 

So far nobody seems to be taking any preventive actions, and it may well cost this country billions of pesos and millions of dollars that are generated through the production of grapes, wine and related industries such as tourism, gourmet food, travel, lodging and employment. Most likely, the Guadalupe Valley will run out of water in the not too distant future and end up being a convenient tourist showcase area for wine tasting and lodging, while the wine industry itself sneaks off to San Vicente, Santo Tomas and other regions where water is more abundant. This would be a major economic disaster for the entire country.

 

Over the last five years I’ve been a witness to an exciting revolution and evolution in Mexico’s premier wine country. Many of the white, red, sweet and dry wines being poured today are of excellent quality.  Many new wineries and businesses (big and small) are offering lucky guests a wide variety of wine, food, lodging and entertainment options. The expansion of the wine industry has led to the emerging wine culture that provides gourmet cuisine, local food products, wine clubs, food and wine dinners, wine tours, and daily adventures into the wine country.

 

And we have a new wine route via Highway 3 from Ensenada towards Tecate (some parts still under construction), providing easy and safe access to the wine country. In addition, the newly paved secondary wine route beginning in Francisco Zarco towards La Mision onto Highway 1 introduces visitors to over ten wineries, romantic lodging, culinary options, and rarely seen undisturbed countryside beauty.

 

I came to Mexico with years of experience in the California wine industry, and I have to say I’ve been more than impressed with the Mexican wine industry, and with the many dedicated and passionate individuals who have made it happen. We’ve all contributed our “two pesos” to the movement, and we have something to be very proud of.

 

Please come to the valley and experience our world of premium wine, food and hospitality.

 

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Steve Dryden is a wine, food and travel writer living in Valle de Guadalupe, in northwestern Baja California, where he guides individual and small group wine tours. He can be reached at sbdryden@hotmail.com. Visit his new blog at www.winefoodguide.com.