Baja Wines

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The Wines of Baja California Today on Wine Business
By Ralph Amey

Editors Note: It's a small, small world and it's an increasingly global wine industry. This feature article is about making wine in Baja California. Did you even know they made wine in Baja? The area is distinct and has its own regional style. Wines from Baja are garnering international attention and medals, as well. Wine Business Monthly feels it is important to highlight this little-known region.


Imagine. I had been teaching and writing about wine for nearly twenty years before I discovered that Mexico has a wine industry, and that it is just over the border in Baja California. I was shocked. You see, I had grown up within three hours of the US/Mexico border, had enjoyed the pleasures of occasional trips to Tijuana, Rosarito Beach and Ensenada, and yet rarely had seen a Mexican wine listed on a restaurant menu in those cities. Even odder, I had never seen one in any of the dozens of wine stores that I frequent in Los Angeles, nor had encountered a U.S. review of a Mexican wine. Considering that I had devoured most wine articles published in Southern California over the past two decades, and faithfully read Wine Spectator and The Wine Enthusiast, not seeing mention of Mexican wines now amazed me.

For most readers this will not come as much of a surprise. Fifteen years ago, if you tried a bottle from Mexico it probably was from Baja California's oldest winery, Bodegas de Santo Tom?/B>. This rustic, nonvintage beverage, intended for early consumption, had probably suffered the further indignity of sitting upright on retail shelves through at least one hot Baja summer. It failed to bring you back for a second taste, and further, you probably had no real idea where this winery was located.

New Look and New Consumers

Today Bodegas de Santo Tom? with its state-of-the-art gravity flow winery, is one of more than a dozen medal-winning wineries in Baja California that are producing a wide range of high quality wines. In a joint venture with California's Wente Vineyards, Santo Tom?also produces a premium red wine blended from equal quantities of grapes grown in the two regions. Marc Bourreli, head of Wente's Mexican sales operations, said that "Duetto is made from crushed grapes from Livermore shipped across the border for blending with Santo Tom?grapes, final processing and aging."

Vibrations from the epicenter of this rapidly growing industry spread throughout several valleys located near Ensenada, in northern Baja California. Principal among these is the Valle de Guadalupe, approximately one and a half miles south of the border. Some two-thirds the size of Napa, it is cooled by Pacific marine air flowing through a notch at its southern end. Named after the unofficial patron saint of Mexico, Guadalupe enjoys a Mediterranean climate that has allowed it and its neighboring valleys of Santo Tom?and San Vicente to become the source of over 90 percent of premium table wines produced in Mexico.

The reasons for this best-kept secret are manifold and complex. Certainly it doesn't help that beer has become Mexico's tacitly acknowledged national drink, that the government has added wine to its list of luxury tax items (hopefully soon to be removed), and that the annual consumption of wine by all of Mexico measures slightly less than that of the inhabitants of the city of San Diego. According to the USDA Foreign Agricultural Service GAIN Report for 2003, "the main consumers of wine in Mexico are in their mid-thirties and above, tend to be well educated, and represent the middle to high-income segment of the population. There is optimism that consumption will increase over the next five years if there is modest growth in the Mexican economy, especially in the restaurant, hotel and tourist sectors."

New Wines

Thus I am happy to state that a growing wine industry is alive and well in Mexico, nowhere more evident than in Baja Norte. Winemakers trained in more than eight different countries are producing exciting wines using modern viticultural methods, state of the art fermentation equipment and innovative winemaking techniques. Hugo D'Acosta, former winemaker at Bodegas de Santo Tom?and now enologist at his own microwinery, Casa de Piedra, stated "we have endeavored to make our ?Signature Wine' using the grapes from the area and its diverse microclimates. Utilizing the latest technology combined with the expertise and sensibility of our winemakers, we have attained a level upon which, each bottle exclusively reflects the personality of the land."

Wineries are beginning to enjoy international recognition as their wines receive more gold, silver and bronze medals in respected competitions. Vina de Liceaga's 1999 Merlot with its dark ruby color, varietal aromas of black cherries, berries and herbs, and bright, ripe stone-fruit and blackberry flavors, received a silver medal in the San Francisco International Wine Competition. Chateau Camou's powerful, almost brooding El Gran Vino Tinto has been a multiple medal winner at competitions (including the L.A. County Fair). Increasingly, restaurants in Mexico are featuring Mexican wines on their wine lists.

Development

Recently, Baja's Tourism Secretariat announced plans to develop a "Grape Corridor" extending through the series of grape-growing valleys of Baja Norte. It is part of a larger plan to promote the wine industry by protecting local aquifers, cataloging the grapes and establishing a council that would define and maintain standards of wine quality. These admirable objectives promise to develop a greater recognition and respect for Baja wines. However, the valley inhabitants who often view the land as a source of grapes, not as an opportunity for population growth and pollution, do not universally embrace such proposals, and the inevitable hotels, fast food stores and housing that accompany them. To the relief of some and the disappointment of others, and unlike Chile, Argentina and Peru, foreign millions so far have failed to pour into the area to finance new vineyards and new wineries.

Mark Hojel, president of the National Association of Wine-Growers Commission (ANV), and a partner in Mexico's first premium boutique winery, Monte Xanic, has stated that "wine-makers want zoning regulations to protect their vineyards from...industrial pollution. They [regulations] need to be initiated and adopted at the local level and this probably makes it more difficult since local legislation is usually very short term focused. Our biggest problem in the Guadalupe Valley is water, since the city of Ensenada has decided to tap into our water supply for urban use. They do not care how this affects the wine industry. At this rate we will have very serious water problems for our vineyards. The [wine] industry would benefit from more government assistance; [however] in Mexico nothing is done without private investment. It would be of great benefit to have foreign investment in this industry to help internationalize the opportunities." Clearly the bottle-neck step in Baja wine production and growth continues to be water availability unless alternative sources become available.

Grapes and Wines
It is important to recognize that Baja is a distinct viticultural region, and its wines display their regional style no less than the wines of Napa, Bordeaux, Chablis and Rioja. The character of Baja wines frequently reveals itself in ripe fruit aromas, rich flavors, medium but distinct mid to forward tannins and mouth feel, and a clean, often lingering finish. The whites sometimes display subtle background minerality, especially those made from grapes grown at somewhat higher elevations and/or in the more granitic soils. The reds often show a sense of warm earthiness that blends well with the intense ripe fruit flavors displayed by the grapes grown here. Among the premium wines produced, the most frequently grown white grapes are Chardonnay, Sauvignon Blanc and Chenin Blanc and the most popularly grown reds are Cabernet Sauvignon, Merlot, Cabernet Franc, Barbera and Syrah. Smaller quantities of Viognier, Colombard, Petite Sirah, Grenache, Nebbiolo, Tempranillo and Zinfandel find their way into some of the bottles.

In fact, many of the winemakers are proving to be enthusiastic and clever experimentalists, offering blends that are sometimes classic and sometimes creatively unique. Additionally, many are good value wines, offering excellent quality at competitive prices. Perhaps more importantly for us who consume them, these are becoming known as wines of pleasure, compatible with the wide variety of foods we enjoy eating. Finally, the valleys' Mediterranean climate provides an environment in which winemakers are finding opportunities for varietal diversity, not limited to just Chardonnay and Cabernet Sauvignon. For example, Dr. Antoine Badan of Mogar Badan produces possibly the only example in North America of Chasselas, the tasty white wine from Switzerland. At L.A. Cetto, Mexico's largest wine producer, Winemaster Camillo Magoni produces a delicious version of Nebbiolo. He insists that a primary goal for him has always been to "make wines with personality."

Typical of Baja's winemakers is the concern for quality expressed by enologist and manager Victor Torres of Chateau Camou: "We are striving day-in day-out to attain a single goal: creating great wines in Mexico?every decision we make is aimed at achieving excellence in this marvelous and complex art of converting grapes into wine." Winemaker Hans Backhoff of Monte Xanic also says, "We cultivate our vineyard with both traditional and modern techniques in order to obtain the maximum expression of our vineyard. One of the most important aspects is controlling yields, sacrificing volume for quality." Backhoff produces 50,000 cases annually and maintains a US partnership with the Chalone Group.

Early Industry

Only in the period of stability following the 1940s did a modern winemaking industry begin to emerge, helped by a rigorous protectionism encouraged by the long-ruling PRI (Partido Revolucionario Institucional) political party. After the Second World War, the Mexican government stimulated the planting of vineyards by quadrupling the tariffs on European wines and by putting quota restrictions on wine imports. Suddenly, French, Spanish and California wines cost five times as much as Mexican wines. As Mexican grape supplies increased, European and American companies began to build their own plants in Mexico. Although primarily to make brandy instead of wine, companies such as Pedro Domecq, Martell Cognac, Seagram and Osborne established themselves as major consumers of Mexican grapes.

In four and a half decades, the area planted to vineyards in Mexico grew more than thirty-fold, from 4,000 acres (1,600 hectares) in 1939 to 117,000 acres (47,000 hectares) in 1985. However, only about 8,600 acres (3,500 hectares) today are dedicated to table wine production. Perhaps a more significant measure of growth is in terms of wine production figures. Many Mexican wineries suffered major setbacks in 1982 when government deregulation of imports brought heavy competition from cheap, low-quality imported wines. This led to many estates being forced out of business and a decrease in overall vineyard acreage and wine production in 1986-90. It is important also to note that only about ten percent of wine production still goes into table wine; the other 90 percent is used in brandy production. From 1992 to 1995 growth continued with current total production reported at more than 2.7 million hectoliters (a 12 percent growth rate). Today about seventeen commercial wineries are registered in Mexico.

Challenges

Taxes challenge the progress of domestic wine sales and consumption. All wines, whether Mexican or imported, have a 25 percent alcohol tax plus a 15 percent VAT added to their price. Due to free trade agreements however, most import taxes on wines are gradually being eliminated. According to the GAIN Report, imports from Chile at present suffer no tax and enjoy a 22 percent market share. The 2000 Mexico/EU trade agreement lowered the EU's import tariffs from 30 to 20 percent, with a further reduction to zero planned by 2008. US wines experience a two percent tax that next year will be reduced to zero. Since 1998 Spain has enjoyed the largest share of the import market, followed since 2000 by equal competitors France and Chile. US wines hold an 8-9 percent share; with California white wines selling best. Chile's success with a less expensive mid-range product priced at around 50-60 pesos (approximately $5-$6) competes well against U.S. wines in the same category priced at 100-150 pesos per bottle. At present, almost three million cases of wine are sold annually in Mexico with 40 percent of sales being domestic wines. According to the National Association of Wine-Growers Commission, Mexico produces around 3 million cases of table wine a year, and between 25 and 30 percent would be classified as premium (above $8 dollars/bottle).

About ten percent, or 300,000 cases of Mexico's annual production is exported to more than twenty countries such as the United States, England, Germany, France, Switzerland and Spain. According to Fernando Favela, former president of the Baja California Wine Growers Association, "exports account for as little as one percent at some wineries but as much as 30 percent at others."

Hojel states that the greatest challenges facing Mexico's wine industry are "the lack of wine consumption in Mexico and the aggressive price competition from foreign wines. We have a feeling that some countries are dumping their products in our market. Without government help and protection this will make the development of the Mexican wine industry more difficult." He continued, "In 2000 the ANV developed an advertising campaign on television that had very little result. Since then we have chosen to do more direct marketing, such as [offering] wine courses." wbm





Ralph Amey ?Wines of Baja California: Touring and Tasting Mexico?s Undiscovered Treasures? is published by the Wine Appreciation Guild. Amey teaches wine classes and writes on various aspects of wine. He is a professor of chemistry at Occidental College, a certified wine educator, and president of the Southern California Chapter of the Society of Wine Educators.