Creating Wine: The Emergence of a World Industry, 1840-1914

Creating Wine: The Emergence of a World Industry, 1840-1914

Creating Wine: The Emergence of a World Industry, 1840-1914

Creating Wine: The Emergence of a World Industry, 1840-1914

Synopsis

Today's wine industry is characterized by regional differences not only in the wines themselves but also in the business models by which these wines are produced, marketed, and distributed. In Old World countries such as France, Spain, and Italy, small family vineyards and cooperative wineries abound. In New World regions like the United States and Australia, the industry is dominated by a handful of very large producers. This is the first book to trace the economic and historical forces that gave rise to very distinctive regional approaches to creating wine.


James Simpson shows how the wine industry was transformed in the decades leading up to the First World War. Population growth, rising wages, and the railways all contributed to soaring European consumption even as many vineyards were decimated by the vine disease phylloxera. At the same time, new technologies led to a major shift in production away from Europe's traditional winemaking regions. Small family producers in Europe developed institutions such as regional appellations and cooperatives to protect their commercial interests as large integrated companies built new markets in America and elsewhere. Simpson examines how Old and New World producers employed diverging strategies to adapt to the changing global wine industry.



Creating Wine includes chapters on Europe's cheap commodity wine industry; the markets for sherry, port, claret, and champagne; and the new wine industries in California, Australia, and Argentina.

Excerpt

Wine is not a homogenous product. a bottle from one of Bordeaux’s first growths of the 2000 vintage today sells for several thousand dollars, much more than virtually any other wine, not just for that particular vintage, but also those produced on the same estates in previous and later years. Like most readers of this book, I have never drunk such a wine and probably never will, but I still get great pleasure from drinking more modest ones. a current favorite for everyday drinking is Tábula’s Damana 2006 crianza, which my local shop sells for around fifteen euros, or twenty dollars. By the time this book is published it may be something else—perhaps because another winery will release a more competitively priced crianza next year; or the Tábula winery may have problems meeting demand for its wines and be forced to buy lesser ones to sell under its own brand (or instead may restrict the supply and raise the price above my budget); or my own tastes may change; or, but highly unlikely, my disposable income available for wines may increase to allow me to move upmarket. I also enjoy drinking Alfredo’s vino tinto, especially as it is free and each glass comes with five or ten minutes of lively conversation (although whether supplies will be quite so forthcoming when Alfredo realizes that I have no influence to help his “export drive” remains to be seen). It is of course this huge diversity that makes wine interesting to so many different people. It also probably explains why few wine histories consider more than a single country, even though many regional studies exist. This book is an attempt to understand the dynamics of production and marketing of all wines during the period of major change that took place between the mid-nineteenth century and the First World War.

Wine production in Europe today is dominated by small family vineyards and cooperative wineries, while in the New World viticulture and viniculture are highly concentrated and vertically integrated. As a result, in the United States and Australia 70 percent of the wine is produced by the top five wine companies; Argentina and Chile, 50 percent; and in France, Italy, and Spain, only 10 percent. in this book I argue that these fundamental organizational differences already existed by 1914 and were caused by six distinct but interrelated variables, namely, terroir (which can be explained roughly as production conditions), tradition (or path dependency), technology, the nature of market demand, political voice (especially of small producers), and political organization in each country. the result was that in Europe the functions of grape growing and wine making were integrated but marketing was a specialist activity, while in the hot climates of the New World the situation was reversed, as grape growing was a specialist

Anderson, Norman, and Wittwer (2004), table 2.1. the figures exclude champagne.

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