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International -- European Business: France
Languedoc's Vintners Get Their Day in the Sun (int'l edition)
Outsiders are transforming a region known for mediocre wine
The setting is quint-essential France: a sun-drenched Provencal farmhouse surrounded by ripe vineyards stretching into the horizon. But the accent is pure Australian. "G'day, mate," greets Ashley Huntington, the general manager of B.R.L. Hardy Ltd.'s Domaine de la Baume, just outside Beziers in the Languedoc region. "Welcome to the future of European wine."
That's a bit hyperbolic, but Huntington has reason to crow. An aggressive band of outsiders is transforming backward Languedoc into one of the wine world's hottest regions. In addition to the Australians, America's Robert Mondavi, Bordeaux's Baron Philippe de Rothschild, and Burgundy's Michel Laroche have made recent investments in the region. The four are investing upwards of $25 million. Together, the newcomers are changing the way wine is made and marketed in France.NEW AMBITION. Languedoc has long been known for producing "plonk"--low-quality wine. But now, the outsiders are replacing low-quality vines with New World-style varietals, such as Merlot and Chardonnay. Most vintners concentrate on producing good values from $5 to $9, but some ambitious winemakers aim to produce much more expensive bottles. This challenge is encouraging some locals to produce higher-quality wines of their own.
Languedoc needed to change. Although the region grows 9% of the world's grapes and about a third of France's, the traditional method for turning the crop into wine has proved self-defeating. Growers are paid by struggling cooperatives for the size, not the quality, of their crop. The problem is that mass-produced grapes yield weak, diluted wines.
When more French stopped drinking wine at every meal--consumption has plummeted from 170 liters per person annually in 1970 to about 70 liters this year--the market for Languedoc's table wine vanished. The European Union ended up buying much of the output, turning some of it into cleaning alcohol.
Instead of drinking $3 bottles of table wine, the French are opting for better-quality bottles from Burgundy and Bordeaux. However, top-ranked French producers have little room to expand in their home regions, where vineyards are scarce and expensive. That makes Languedoc's almost limitless productive capacity attractive. "Here you can buy vines for a tenth the price in Burgundy or Bordeaux," says Yves Barry, Laroche's chief Languedoc winemaker. Languedoc's vineyards sell for as little as $5,000 per hectare.
The outsiders are bringing with them top-quality techniques as well. By paying two times more for grapes, they have encouraged farmers to slash yields by more than half and replace the region's traditional lowbrow Carignan grape with better-quality Syrah, Cabernet Sauvignon, and Chardonnay. While most wine produced in France is a mixture of different grapes and sold according to its geographic origin, such as Burgundy, Bordeaux, or Cote du Rhone, the newcomers have picked up the New World habit of producing and marketing single-grape varietals. "It's much easier for foreign consumers to understand Chardonnay than Coteaux de Languedoc," says Laroche.BIG WRITE-OFF. Not all of the newcomers' initial efforts have been successful. Wine critics have given mediocre ratings to some of the newcomers' vintages, including Mondavi's. The Napa Valley (Calif.) vintner took a $4 million write-off this year because it had to discount 200,000 cases of its Languedoc production. "We overbought, and the competition among moderately priced Languedoc varietals is stiff," admits David Pearson, the general manager of Robert Mondavi's Vichon Mediterranean unit.
But the newcomers are moving to overcome such problems. Instead of just buying grapes, Mondavi has set up an office in Montpellier, and Pearson is searching to buy land to plant vines to produce a premium wine. "We now think you have to shoot higher up the value chain," he says.
Locals are catching the fever, too. When Jean Paux-Rosset decided to plant new vines and reduce yields at his family's Chateau Negly in La Clape near Narbonne, "my father thought I was crazy." Paux-Rosset persevered. An American distributor championed his wines, and Guides Hachette's wine guide gave him the top three-star rating this year. "I have proved that you can produce wine as good as any Bordeaux or Burgundy," he says. Chateau Negly's Porte du Ciel sells for $80 a bottle, and Paux-Rosset can't produce enough to meet demand. Not bad for a region long known for plonk.By William Echikson in Beziers