This article first appeared in The Old Town Crier October 2010
By. Neil Williamson
October is Virginia Wine Month. Annually, Grapevine takes this opportunity to offer a longer view of the wine industry in the Old Dominion. The goal of this column is to encourage folks to not only drink Virginia wine but to experience the wineries and the wine trails. To that end, we provide a travelogue of our Virginia wine journey. This month we focus on the industry as a whole, the past, the present and most importantly the future.
Virginia has a rich history in wine dating back to 1608. While Thomas Jefferson, the father of the American Wine industry, failed in his attempts to produce wine from his Charlottesville estate the Monticello Wine Company in the late 1800’s produced internationally award winning wines from their Charlottesville location (near the intersection of McIntire and Wine Street). Unfortunately for the industry, prohibition pushed farmers to till over their vineyards and plant apples, hay, or tobacco.
When the General Assembly passed the Farm Wineries Act in 1979, there were 6 wineries and 286 acres devoted to wine grape production in the state. In 1999, when I joined the industry there were less than 100 wineries, today there are over 162 licensed farm wineries and over 2,500 acres of wine grapes in the Old Dominion. It is important to note, everyone in today’s Virginia wine industry stand on the shoulders of the industry pioneers. Names such as: Flemmer, Hill, Hollerith, Horton, Hubert, Morrissette, Law, LeDucq, Morton, Parker, Randel, Rausse, Rousse, Rogan, Sweedenberg, and Zonin [I am sure I am forgetting a few] belong in a Virginia Wine Hall of Fame.
Today, Virginia ranks 5th in the nation for commercial wine grape production (behind CA, WA, OR, and NY). According to Virginia’s Department of Agriculture and Consumer Services, Chardonnay comprised 19 percent of Virginia’s total Vitis Vinifera production harvest in 2007. Chardonnay, Cabernet Franc, Merlot, Cabernet Sauvignon and Vidal Blanc were the top five varieties produced in the Commonwealth in 2007.
Beyond quantity the Virginia wine has become more consistent in its quality. First, the science of grape growing in Virginia is expanding. With increased experience and the growing research data from Virginia Tech (specifically Tony Wolf and Bruce Zoecklein) newer entrants to the industry have better tools at their disposal.
The expansion of the industry has created great knowledge cross pollination. As examples, Barrel Oak’s Sharon Roeder spending two harvests as a cellar rat prior to opening their winery, Franz Vente spent years working with Jefferson Vineyards before he took over at Sweely Estate. Virginia wine experiences coupled with international experiences of winemakers like Blenheim’s Kirsty Harmon (France, New Zealand), Horton’s Mike Heny (South Africa) and Virginia Wineworks’ Michael Shaps (France) creates a powerful understanding of soils, climates and winegrowing.
It is not unusual for winemakers to come to Virginia with formal degrees in enology from Virginia Tech, UC Davis, Mississippi State or Purdue. In addition, several experienced winemakers and winegrowers now consult with potential new entrants to the industry. These advances coupled with the willingness to work cooperatively rather than competitively, the knowledge base of winegrowing in Virginia has grown exponentially over the last decade.
Winery owners’ commitment to quality is the third leg of this stool. It is less expensive to make a lower quality wine as the industry has matured owners have recognized the long term value to a consistently high quality product. Such a commitment requires a commitment to capital and a long term vision. Virginia is blessed to have a majority of owners with both of these enduring qualities.
Growing quality wine is a big business in Virginia. A study completed by MKF Research LLC, a California-based wine industry research organization, calculated 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.
Even with this significant impact, Virginia has a long way to go in terms of market penetration. Only 4% of the wine sold in the state of Virginia is Virginia wine. It is surprising to me when people tell me they don’t like Virginia wine, I ask them when they last tasted Virginia wine. Usually, it was ten years ago, I then ask what they think of computer equipment that is ten years old? Virginia wine on the whole is very good but not enough Virginians know it.
To that end, Governor Bob McDonnell recently approved doubling the Virginia Wine Board’s marketing budget and Virginia’s First Lady Maureen McDonnell has been visiting Virginia’s wineries over the last couple of weeks. Traveling with members of the Virginia Wine Marketing Office and a number of wine writers, the First Lady has made a significant impression and provided a great media boost for the industry.
In addition to the administration’s domestic efforts, McDonnell and his Secretary of Agriculture and Forestry, Todd P. Haymore spent the latter part of July on a trade mission to Europe that included promoting Virginia wine in the United Kingdom. Last year, my London based brother reported seeing a number of Virginia wines at the Whole Foods in Kensington.
In their UK meetings, Haymore reported Virginia wines were very well received. The Kensington store, where my brother spotted the wines, has fully embraced Virginia as a wine region dedicating a specific section only to Virginia wines. According to Haymore, “Because of the sales and the attention our wines have received since hitting the racks, the store believed that Virginia wines merited a stand alone section rather than being mixed in with the other U.S. wine.
The UK is the world largest wine import market. While this international foray may not be the main sales channel for all of Virginia’s wineries it does add significant credibility to Virginia wine’s reputation.
Where does Virginia Wine grow from here?
As the economy slowed, so did the opening of new wineries; but an interesting new business models emerged – from personal wines to the custom crush winery.
A number of wineries allow consumers to become the vintner, making decisions about what fruit to include, what barrel type to use, how long to keep in barrel, label design etc. These smaller labels are more along the lines of personalized wines created in limited production often for personal or corporate use.
For the more ambitious vintner, several wineries now do custom crush for labels other than their own. By leveraging the existing winery’s assets, the new winery reduces the cost barrier for entry into the market. The existing winery is able to generate revenue from excess production capacity. If the new entrant has just planted a vineyard, purchased fruit can provide wine while the vineyard grows into production (3 years). The custom crush model was tried several years ago in a cooperative fashion. It has worked exceedingly well in California. The latest iteration of custom crush has launched over a dozen new Virginia wine brands in the last five years.
The Virginia wine industry is strong despite the recent economic challenges. In the next five years, as the economy improves (and we all hope it does) Virginia wine is poised for another growth spurt. With a strong population center and some desirable growing areas, I anticipate seeing additional wineries in the Tidewater area perhaps focused on hybrid grapes that do well in their more sandy soils. I also project a few new winery entrants in the southwest corner of Virginia.
I also believe the custom crush method of a winery launch is here to stay. Whether the brand is simply launched by another winery and then taken to another site or it is a long term arrangement, this business model makes too much sense not to continue.
After ten years in the Virginia wine business, I continue to be optimistic about its future. With a series of supportive Governors who recognize the significant contribution of Virginia wine and the wine press that is starting to recognize that Virginia wine has a personality all its own, Virginia wine is destined to continue to build on the high quality and high integrity of the people and the wines they represent.
Neil Williamson is the Editor of The Virginia Wine Journal and Chairman of The Virginia Wine Club Tasting Panel. He can be reached at email@example.com.
VIRGINIA WINE PROFILE Wineries: 163 (with more in the pipeline)
Vineyard Acreage: 2,500 acres planted (2008)
Grape Production (in tons): Cabernet Franc 924
(2008 data) Cabernet Sauvignon 524
Petit Verdot 225
Vidal Blanc 497