April, 2008

The AVA Labeling Controversy Heats Up

Written by: Ben Bicais on Monday, April 21 2008   1 comment

Calistoga AVA Controversy

Calistoga is a Major Battleground

For centuries, wine has been associated with regions because it is such a distinguishing factor of character and quality. Very few would argue that the location grapes are grown does not make a difference (except maybe Fred Franzia). The issue of labeling wine with a specific region has become a little contentious in California lately, and Calistoga is a major battleground.

In 2005, Bo Barrett of Chateau Montelena petitioned the Federal Government to create a Calistoga AVA in Northern Napa Valley. Based on the TTB’s criteria for AVA creation, he had a perfectly legitimate case. Calistoga certainly has a history of producing distinctive wines based on soil, climate, and other physical factors.

But Barrett’s proposal stirred up quite a controversy, namely with Calistoga Cellars. This winery has built an established brand name around the region, but does not use the required 85% of Calistoga grapes in their wines. Calistoga Cellars vehemently opposes the creation of the Calistoga AVA, because if it goes through, they will have to either change their brand name or start using the required amount of Calistoga grapes.

The Federal Government responded to this dilemma by suggesting considerable changes to the current wine labeling laws. More broadly, they fundamentally called into question the significance that place of origin has on resulting wines. This has reignited the ongoing battles between brand-centric and terroir-centric wineries.

Barrett admirably wants to preserve the accurate portrayal of geography on wine labels. Local terroir gives artisanal wines their character, and this should be protected. Barrett has some powerful allies, including the Napa Valley Vintners.

According to Richard Mendelson, attorney for the Napa Valley Vinters, “When consumers buy a bottle of wine in a restaurant, order off the list and see Calistoga Cellars, they’re going to think it’s from Calistoga.” This is a valid point and pretty much sums up why regional names should be protected.

At the same time, it is also understandable that Calistoga Cellars will not relinquish their name brand or alter the makeup of their wines without a fight. But because so many wines are marketed largely on their region of origin, it is misleading to the customer to falsely claim an association with a region that does not exist.

A possible solution might be for the federal government to disallow the use of any region on a wine label that does not meet the required 85% of grapes to be labeled as such, but fairly compensate existing wineries that will be affected. In the future, they should prohibit any winery naming themselves after a region unless they meet the AVA’s requirements.

But this would not account for wineries that are named after future AVA’s that do not yet exist, so a remedy would need to be devised for these situations as well. America does not have an exceptionally long history of wine production, and in many cases, the distinctions between regions are just starting to crystallize. This is clearly a difficult issue and will likely require considerable mediation and litigation to be resolved.

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California Wine has Record Sales in 2007

Written by: Ben Bicais on Friday, April 04 2008   2 comments

California Wine Sales

According to the Wine Institute, sales of California wine reached another new height in 2007. Fueling this growth is America’s increasing taste for premium wine over the past decade.

In 2007, the total volume of wine sold in the United States was 457 million gallons, a 2% increase from 2006. The retail value of all wine sold in the U.S. rose even more sharply to $18.6 billion, a 6% increase.

“Strong consumer interest, along with growing retailer and restaurant support and more direct-to-consumer sales, is resulting in wider distribution and selection of California wines. The new California tourism TV advertising campaign is also raising consumer awareness of the state’s diverse wine regions, its talented families, and its outstanding wine and food offerings.” -Robert P. Koch, CEO of the Wine Institute

Although still a relatively small part of the market, direct sales grew a very substantial 7.4% in 2007. Over 90% of California wine is still distributed by wholesalers, but many wineries are successfully developing direct to consumer sales channels.

U.S. wine exports also hit a record high in 2007. Total volume rose 8.6% to 120 million gallons at a price of $951 million, a 12% increase. California Wine Country was responsible for 95% of the United States’ wine exports last year.

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Ben Bicais Hello, my name is Ben Bicais, and I would like to personally welcome you to Calwineries. Growing up in the Napa Valley... Find out more.

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