Monday, July 26, 2010

Why a vine pest is responsible for direct shipping laws

As I was sitting on the couch last night reading the latest issue of Wine Spectator (Aug. 31, 2010) I stumbled across an article by James Laube (pg. 37) entitled "Direct Shipping Threatened". The article talks about how the proposed H.R. 5043 bill would be detrimental to the domestic wine industry, especially small wineries in California.

He wrote about small wineries like Carlisle in Sonoma that produce about 6000 cases annually and ship 85 percent of their wine directly to their customers. They're concerned that without direct shipping their prices will double. In the article the owner of Carlisle, Mike Officer, was quoted saying they have a wine they direct ship for $48. "48 bucks?" I thought, why the hell do they have to charge $48 for a Zin from California? Is it laced with gold? It got me thinking about cause and effect and why they need to charge that much for a wine that comes from our country.

After stewing about this for a while I came to the conclusion a vine pest is responsible for the push by many California producers to pass a direct to consumer shipping law. Before I go any further I need to explain two things. First, I'm not crazy, I only believe slightly in flying saucers and conspiracy theories. Second, I support direct to consumer shipping 100%. I think that this situation has been strong armed and has gotten out of control. I believe we must pass a law that allows wineries and online retailers to ship wine directly to the consumer. With that said let me explain why a vine pest is responsible for the large push by California wineries to pass a direct shipping law.

The vine pest I am referring to is phylloxera (fihl-LOX-er-uh), an aphid responsible for one of the greatest agricultural disasters of all time, right up there with the 1840's potato famine of Ireland. Phylloxera is a small yellow root feeding pest that feeds on grape vines, kills them, and then moves on. The pest only takes three years to kill a vine entirely.

It was first discovered in the south of France in the mid 19th century. Many farmers just chalked it up to another pest and figured excessive spraying or even the cold winter would kill it off. But when it didn't die, and kept spreading, they got worried. Desperate and willing to do anything to kill it they tried things like flooding their vineyards to more crazy ideas like irrigating with white wine or placing a living toad beneath the vine to suck up the poison. Little did they know the answer was ultimately the problem. It took a Texan, who I imagine wore a big belt buckle, to find the solution.

To understand what happened I need to explain grape vines quickly. Even though there are more, think of the world as having two grape vine species: the European Vitis Vinifera and the native American Vitis Riparia. The European Vitis Vinifera vine is responsible for all of the quality grape bearing vines preferred for making wine including but not limited to: Riesling, Sauvignon Blanc, Pinot Noir, Merlot, Cabernet Sauvignon, Syrah, etc, etc, etc. The Vitis Riparia vine on the other hand is used primarily for the production of table grapes and when producing wine, which is rare, it is said to display "foxy" characteristics.

When Europeans imported native American Vitis Riparia grape vines in to places like France and Italy they had no idea that the vines were carrying a pest that was about to destroy their crop. Over time the American native Riparia vine had built up a resistance to phylloxera, the native European Vinifera vines did not have this luxury. So when the two came in contact the aphid jumped ship and started attacking the Vinifera, or wine preferred, grape vine. The solution as I mentioned earlier was the cause. They corrected the problem by grafting (cutting and retraining) the Vinifera vine to phylloxera resistant Riparia rootstock. But not before an estimated six million+ acres of grape vines were devastated by the pest.

The transition of American native rootstock to European vines was not smooth sailing. First, Europeans did not want their wines tainted with the “foxy” characteristics of the American vine. Second, the American rootstock struggled in European soils. The amount of grafting alone was overwhelming, trying to convert all of the vines over to American rootstock seemed impossible. Regions like Burgundy banned the use of American rootstock until 1887, however they were affected in 1878 and by 87’ the growers forced the government to overturn the law.

It wasn't just Europe that was affected by phylloxera, by 1885 most of the world, including California, had been infected with the pest. When the Texan found out you simply need to put the two together (like peanut butter and jelly) to solve the problem he didn't take in to account that the pest might mutate or there might be another strain. As a result the first grafting used didn't work as well as they thought it would. The Euros knew this and told the Americans not to use the first one (called AXR1) and to instead use the second, it worked better. But we didn't listen. So in the 1980's America was plagued one more time by the aphid.

The AXR1 UC Davis engineered was higher yielding (fruit to vine ratio), but it was not completely resistant. So when the pest reared its ugly head the second time as ‘Phylloxera B’ California and other states were forced to rip up their vines and plant the more resistant Vitis Belandieri rootstock to the Vitis Vinifera vine. This in turn resulted in a price increase for California wine because somebody had to pay for all of the replanting, and that somebody is you and me - the consumers. It's safe to say the second coming of phylloxera is why California wine prices are higher than most other wines in their category and in my opinion the others will likely never catch up, not that they want to.

So that brings us back to direct shipping. Many small wineries that have wine retailing for $25 at the winery are able to honor that price nationally by shipping their juice direct to the consumer. They are worried about what will happen if they are forced to add a middle man. Their prices will hit the shelves at $50 a bottle because another hand has to make money on it. At double the price they fear they won't be able to sell their product or will have to take significant cuts on their margins to remain competitive.

Small wineries and their prices are just one of the many components in the "Free the Grapes" campaign. Without going too deep in to the politics of the situation this campaign comes down to who has the most lobbying dollars, distributors (wholesalers) or wineries. Wholesalers already have a lot of money invested (Laube reports $11.5 million) because they have a lot to lose if a direct shipping bill passes. Distributors like Southern or Johnson Brothers won't support the "Free the Grapes" campaign because they will ultimately be cutting in to their profits by allowing wineries and online retailers to have more national presence. If a bill were to pass allowing direct shipping less wine would go through their hands and they would run the risk of loosing brands. They want to eliminate even the minimal laws that currently exist allowing wineries to ship direct to the consumer in select states at regulated amounts.

But the small wineries are an important part of this situation because they are the ones not present on the retail shelf. If you want to drink Zinalley Zinfandel you have to have it shipped to you or you have to purchase it at the winery. A place like this has such a low case production and that coupled with a price of $25 a bottle we can see that it wouldn't make any sense to offer it through distributors. You'd be hard pressed to sell a Central Coast Zin in a retail store for $50, nobody would buy it.

If you've ever been to California to taste you would agree, mailboxes at the end of a gravel driveway are an important part of California wine tourism. If they can't sell the limited wine they have via direct shipping they will go out of business and there won't be any of these great little diamonds in the rough left in the state. These quaint artisan wineries are all part of the fun of exploring wine country.

Have you ever stopped to think why a Syrah from Australia (called Shiraz) can be so good for so much less than a Syrah from California? Riddle me this, Aussie Shiraz has to cross a giant ocean, the Californian Syrah simply has to cross the country. The Aussies have to go through customs, the Californians don't. So why is it that our prices are so high? As you can see from the information on phylloxera a large part of this is due to the devastation the second time around. We had to rip it up and do it again, they didn't. Take all of this information and we see that a vine pest name phylloxera is responsible for the push by small wineries to pass a direct to consumer bill. To be frank, I'm with them...FREE THE GRAPES!!!

As always thanks for reading. Check out the new sample wine tasting we have posted at Cru Wine Online.

Nicholas Barth
Certified Sommelier
Wine Director
Cru Wine Online

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