Virginia’s wine industry has matured
- October 1, 2008
by Jim Raper
At restaurant Tru in Chicago husband and wife chefs Rick Tramonto and Gale Gand preside over one of the nation’s most innovative kitchens.
The wine list alone tempts patrons with 1,700 labels from venerable producers throughout the world. So why would Chad Ellegood, the restaurant’s wine director, be striding through the dining room clutching a bottle of Barboursville Vineyards 2006 Reserve Viognier from upstart Virginia?
Tru has been offering a 10-course dining experience called the “Sommelier Collection” at the prix fixe of $350 per person, including tax and tip. One of the lineups featured in this special program begins with the Barboursville Viognier. It’s served with a grape gelee topped with a crab and cucumber salad. The meal moves on to nine other courses anchored by ultrapremium wines such as a French Meursault, Italian Brunello and German Traminer Trockenbeerenauslese.
A Chicago Tribune reporter who reviewed the meal declared that the Virginia wine — which retails for $22 — stole some of the thunder of wines costing three to five times as much. The evening’s “most surprising wine may well be … a Virginia Viognier from Barboursville Vineyards,” he wrote. “The 2006 wine, made by Barboursville’s general manager and winemaker, Luca Paschina, is astonishingly elegant.”
Indeed, Sommelier Ellegood considers the Viognier from Orange County an exciting discovery. “This wine is so like the great Viognier of France, Condrieu, so pure and clean, with coriander, lemon and honeysuckle. It’s been well received here. I’m looking now for someone who can recommend more Virginia producers to me.”
This is the type of endorsement the Virginia wine industry needs, particularly now. After three decades of growth, industry insiders say Virginia has reached a tipping point. While the state has come a long way — it was named last year as one of the top five new wine travel destinations in the world by Travel & Leisure magazine — there is still much to be done before Virginia wines gain the market share that will propel the industry to new heights.
These days, insiders describe the industry as “distinctive” and “understated.” Yet the label some people yearn for is “blockbuster.” To get there, they say Virginia and its winemakers need more production, marketing and distribution. Plus, they need to make the price point more accessible. Not everyone is willing to pay the going rate of $20 to $45 for one of the better bottles of Virginia wine.
William Moses, the former IBM executive who sprang to prominence in Virginia wine circles after he married Patricia Kluge, is forthright with his appraisal. The CEO of Kluge’s ambitious estate winery and vineyard near Charlottesville has been a key industry player now for nearly a decade. “The farm winery business in Virginia is healthy but at a tipping point,” he says. By that, Kluge asserts that the overall uality of Virginia wines — and the world marketplace’s perception of the quality and uniqueness — must be ramped up over the next few years or else the industry will stagnate.
Many of Virginia’s longtime winemakers agree. “We are a provincial, regional industry and always have been, but now there are some big players and people are focused on competition, global competition,” says Jim Law, the owner-winemaker of Linden Vineyards in Northern Virginia’s Fauquier County. “So far, it’s been easy to sell Virginia wine to Virginians, but we will soon saturate that local, patriotic market, and we won’t be able to sell wines just because they are from Virginia. We’ll sell wines because they are of high quality.”
From vineyards covering 2,400 acres, the state produces 5,600 tons of grapes. That translates into 400,000 cases of wine, worth nearly $70 million. A recent study done for the state by MKF Research LLC, a California-based wine industry research organization, put the total annual economic impact of Virginia’s wine industry at close to $350 million. It provides jobs for 2,750 people and generates $35 million in annual taxes.
Still, there’s plenty of room for growth. A meager 4 to 5 percent of total wine sales in Virginia are of Virginia wine, with the figure rising only slightly in recent years. Some Virginians “have low expectations of us,” observes Jennifer McCloud, owner of Chrysalis Vineyards in Middleburg. “In my opinion that is primarily a stale concept.” She contends that people tend to blame today’s industry for wines they tasted years ago “that were the work of mom-and-pop, bucket and funnel winemakers.”
Moses led the Wine Study Work Group appointed by then-Gov. Mark R. Warner in 2003. It wrote a strategic plan for the Virginia industry titled Vision 2015. The No. 1 goal? Double the state wineries’ share of Virginia wine sales to 8 or 9 percent by the middle of the next decade.
The plan calls for more state funding for production research and marketing. Currently, Virginia spends $387,000 a year to market its wine. The money comes from the $550,000 in wine taxes set aside to support the industry. Increased spending would support a quality assurance program to weed out poor wines that drag down the industry’s reputation. More dollars also would boost co-promotions between the state’s tourism and wine industries and an asserted effort to identify varietals such as Viognier and Cabernet Franc that can be as closely identified with Virginia as Pinot Noir is with Oregon.
Last year, the Virginia Wine Board — whose current roster includes Moses and McCloud — hired a marketing specialist to work toward the goals of Vision 2015. Annette Ringwood Boyd, who was part of a now-defunct state wine promotional initiative of the state Department of Agriculture from 1987 to 1992, returned a year ago to serve as the full-time executive director of the Virginia Wine Board Marketing Office. “My charge is to take the strategic plan and build it,” she says. By late summer of this year she had unveiled a new Web site at http://www.virginiawine.org and produced a user-friendly online guide to the hundreds of wine festivals and winery events held around Virginia each year.
Boyd is keen on emphasizing the “Virginia style” of winemaking. It delivers white and red wines that are stylistically different from heavily extracted, high-alcohol California wines. “Our wines tend to please Europeans, for whom the California bias does not exist. And our wines, arguably, go better with food,” she says.
Boyd also favors a program that will provide quality assurance to customers. The example she mentions is the Vintners Quality Alliance in Ontario, Canada, which offers vintners there the opportunity to get a VQA stamp of approval — essentially assuring customers that the wine is authentic and well-made. This is something like the official appellation or denomination programs in Europe that, for example, require a Chianti wine to be tested before it can be sold as Chianti Denominazione di Origine Controllata e Garantita.
Some say the obstacles to a VQA-type program in Virginia seem insurmountable. For two decades state enologist Bruce Zoecklein, a professor at Virginia Tech, tried to rally the industry around a VQA model. Now, he says bluntly, “It’s not going to happen. I regret that we didn’t get this going when the wineries were a closer community. Now it’s kind of like beating a dead horse.” Many winery owners oppose the idea, he adds, because a Virginia stamp of approval would need “to be backed up by major marketing funds to mean anything, and we don’t have those funds.”
Several industry representatives say privately that Virginia vintners are too stubbornly independent to allow a sanctioning body to tell them whether their wines smell and taste okay. Adds Luca Paschina, an Italian by birth who works for the Italian Zonin family that owns Barboursville Vineyards: “It’s proven that sanctioning doesn’t work. Look at Chianti. There are some pretty mediocre $10 bottles of Chianti, and all the regulations are not sufficient to keep them out of the marketplace. I believe that in the marketplace consumers show the path. They decide whether this bottle is good and this is not.”
Zoecklein has turned his attention now to his Virginia Tech Enology Services Laboratory. For a fee, paid by a producer, it will put a wine through chemical, physical, microbiological and sensory assays. Since the lab was launched two years ago, it has performed 8,000 different assays on 4,392 wines. The results sent to winemakers can pinpoint flaws and suggest ways to correct deficiencies.
The “provincial” Virginia industry described by Law of Linden Vineyards began in the mid-1970s. By 1980 the General Assembly had adopted the necessary statutes to give wineries the right to bypass the three-tier system (manufacturer, wholesaler, retailer) that regulates most alcoholic beverage commerce. In other words, a farm winery could self-distribute. This was a boon for Virginia’s many small, family-owned enterprises, because it allowed wineries to cart their bottles to nearby restaurants and retail outlets, paving the way for growth.
However, an adverse federal court opinion in 2005 ended self distribution. The U.S. District Court called Virginia’s earlier law unconstitutional on the grounds that it granted privileges to Virginia wineries that weren’t extended to out-of-state wineries. Self-distribution became illegal on July 1, 2006, dealing a major blow to smaller winemakers who can’t afford wholesale distributors.
In 2007 the General Assembly came up with an alternative. It passed legislation allowing the Virginia Department of Agriculture and Consumer Services to serve as a wholesaler to small wineries. The nonprofit Virginia Winery Distribution Co. opened in April of this year and can make direct sales to stores and restaurants. The limit for wineries is 3,000 cases per year. So far, about 70 wineries have signed on, with many of them producing 2,500 cases per year. Some of the states larger wineries produce 10,000 to 60,000 cases and use wholesale distributors, particularly in out-of-state markets.
Even with the advantages initially granted by the legislature, however, there was no rush to launch the wine industry. Only a handful of wineries existed in the state in 1980. By 1995 the number had grown only to 46. Since 1995, however, the trend has spiked, tracking increased wine consumption throughout the nation — especially in the Washington, D.C., area. One beverage market survey rates the region as having the nation’s most enthusiastic wine consumers. Perhaps to capitalize on its proximity to this market, the number of state wineries jumped to 107 in 2005 and today stands at 140. The only states with more wineries are California, New York, Oregon and Washington.
With the growth came sophistication, albeit slowly. Felicia Warburg Rogan, who founded Oakencroft Vineyard and Winery outside of Charlottesville in 1983, remembers not so fondly her first demijohn of wine, made in her garage from humble hybrid grapes called Sevyal Blanc. “It wasn’t very good, but, thank goodness, I persisted,” she says. To save money when she started Oakencroft she bought used dairy tanks. “They called me the dairy queen,” she says, laughing. “Now, we’re the oldest winery in Albemarle County.” Rogan plans to close the winery when she retires at the end of the year.
While the state focuses on increasing sales in Virginia, winery owners look to outside image-building to build the Virginia brand. “We have to influence the opinion leaders all over the world,” says Patrick Duffeler, owner of Williamsburg Winery and a member of the Virginia Wine Board.
Reports about Virginia wines in influential publications have been kinder recently, after some rocky decades. The watershed tribute to Virginia winemaking that appeared in the New York Times in 2000 — written by the late Times staffer and gourmand R.W. “Johnny” Apple Jr. — reflected the critical skepticism of the 1980s and ‘90s. The headline read, “Jefferson Gets His Wish: At Last, a Decent Bottle of Virginia Wine.”
Then came Virginia’s anointment last year by Travel & Leisure magazine. Wine and spirits editor Bruce Schoenfeld gave the state’s industry a big boost by including it, along with regions in Italy, Spain, Chile and New Zealand, as one of the world’s up-and-coming wine destinations. “Until recently,” he wrote, “I’d felt that [Virginia] had been trading on the grape-growing reputation of noted wine lover Thomas Jefferson for 200 years without producing anything worthy of mention. Then a single bottle convinced me that Virginia was ready for consideration.” That bottle was a Barboursville 1999 Nebbiolo. Schoenfeld later in the article also praised the Linden 1999 Hardscrabble Chardonnay.
As an advocate of spreading the message about Virginia’s wines, Duffeler has been the leading proponent among Virginia vintners of presentations abroad, particularly in London. In the past 18 months he has been part of two such delegations. Why London? “Because that’s where the most visible wine critics in the world are,” he explains. “Hugh Johnson, Jancis Robinson, Clive Coates, Michael Broadbent.” (Broadbent’s son, Bartholomew Broadbent — who has followed in his father’s wine critiquing footsteps — recently moved from California to Richmond after purchasing a home on Monument Avenue, one of the city’s most prestigious addresses).
Besides, adds Duffeler, the palate of critics on the other side of the Atlantic seems to favor a Virginia style of wine that is “elegant, understated, vastly different from California wines that have the intense body of sun-drenched grapes.”
Duffeler hopes to be ses in England, and probably Denmark, very soon. The Britain-based wine magazine Decanter has encouraged him by naming the Williamsburg Winery Acte 12 Chardonnay to its “Best Wines in the World” list in 2007 and again in 2008. No wonder he thinks Virginia wines can sparkle outside the Old Dominion.