Thursday, December 27, 2007

Baja California Sur: Wine Market's Last Frontier.

Baja California Sur: the wine market's last frontier.

By Jane Firstenfeld

At the southern tip of the Baja California Peninsula, Baja California Sur (BCS) is Mexico's newest and most isolated state. Its capital, La Paz, beside the Sea of Cortez 120 miles north of Cabo San Lucas, lies just above the Tropic of Cancer, 1,000 miles of torturous, two-lane highway from the California border and 100 miles by ferry from the nearest mainland port. Though the state boasts one of the highest per capita incomes in Mexico, cost of living is correspondingly elevated: with an economy based on tourism, agriculture and fishing, and virtually no manufacturing or industry, most of life's necessities and luxuries must be imported from either the U.S. or mainland Mexico. It's like living on an island, and a single hurricane or tropical storm can make the island metaphor a literal fact, blocking maritime traffic and severing the thin lifeline of the trans-peninsular highway.

These hardships are offset by year-round sunshine; world-class tropical beaches, diving, sailing and sportfishing; a unique desert environment, and countless miles of wide-open spaces. With an area roughly the size of Florida, BCS has a population of only 350,000; about half are La Paz residents. The 50,000 permanent inhabitants of Los Cabos (Cabo San Lucas and San Jose del Cabo) play host to more than a million tourists every year, and these two areas are also home to a growing population of foreign residents: retirees, cruising yachters, and entrepreneurs cashing in on the tourist market.

This ever-increasing influx of foreign tourists and residents has left its mark on the formerly remote and untouched character of Baja California Sur. The foreign influence is most obvious in Los Cabos, where every beach is surmounted by a luxury hotel, and the Hard Rock Cafe and Planet Hollywood share pride of place with Domino's Pizza and Burger King. So far, La Paz has resisted the franchises, but a visit to any of the city's three major supermarkets reveals an evolving lifestyle increasingly based on U.S. tastes and products: Lean Cuisine and Sara Lee; frozen bagels and Cajun sausage; and, in recent months, a noticeable expansion of the wines, particularly imported wines. The Central Commercial California (CCC), La Paz' largest supermarket, now devotes one entire aisle of shelf space to wine; this equals the total shelf space allotted to all other alcoholic beverages (excluding beer) but including tequila, brandy and rum, the traditional Mexican favorites.

Though by California standards the selection is still quite limited, today's stock of close to 20 foreign labels represents an increase of almost 1,000% in comparison with just a year ago, when E. & J. Gallo varietals, Farron Ridge (Chateau St. Michelle) red and white, and Boone's Farm flavored wines were the only U.S. imports consistently available. Among the current offerings: Robert Mondavi Woodbridge Chardonnay and Cabernet (about $10.50 U.S); Kendall-Jackson '95 Reserve Chardonnay (about $19); E. & J. Gallo Chardonnay and Cabernet ($7.50); Merlots by Louis Martini ($18) and Round Hill ($11); Korbel Brut ($10); and Sutter Home "Fre" alcohol-free Chardonnay ($10). Other imports include a Barton & Guestier 1990 Medoc ($21); a Chateauneuf-du-Pape ($25); Casillero del Diablo Chilean Chardonnay ($9.50) and another Chilean offering, Santa Lucia 1996 Cabernet, which, with its nouveau lightness and accessible price of less than $5 per bottle, has quickly been adopted as a house wine by many baby-boomer expatriates.

Given the diminutive size and grand isolation of the market, the elevated prices are understandable, although many foreign residents, living on fixed incomes, feel constrained from daily consumption. What is surprising is that, with the exception of jug wines like the ubiquitous Padre Kino, Mexican varietals (most produced on the upper Baja California peninsula) can be as pricey as many of the imports. Pedro Domecq 1993 Cabernet is priced at about $6, and Santo Tomas 1991 Cabernet is $11, while Cetto Chardonnay goes for $10.

Juan Olave is head of purchasing for all CCC operations, which include two expansive U.S.-style supermarkets in La Paz, a wholesale department serving restaurants and hotels statewide, and an importing branch for all types of merchandise including liquors and wines. He explained that the increase in imported wines was spurred by the wholesale clients, especially hotels and restaurants in Los Cabos catering to foreign tourists; the La Paz retail market is simply a bonus.

The demand for expanded and more sophisticated wine lists prompted the CCC to engage what Olave termed "probadores" (tasters) in San Pedro and San Francisco to upgrade the chain's stock of imported wines. Longterm provider E. & J. Gallo maintains it own distributor in Tijuana, and major Mexican distillers have recently entered the import market, Cuervo with the Chilean vintners and Domecq With Spanish wines.

Admittedly, all this bustle of activity doesn't amount to much in the world market: according to Olave's records, total retail and wholesale sales of Mexican-made wines amount to 300 cases of red and 200 cases of white monthly; all imports account for just 100 cases of red and 100 cases of white per month.

Olave, though, is optimistic about the future of the wine market in Baja California Sur. While readily acknowledging that Mexico, and BCS in particular, has no tradition of wine consumption, "We are just beginning to develop a culture of wine here". Already he sees increased consumption "at a certain level" of La Paz' professional and bureaucratic society.

"At this level, people are becoming conscious of the benefits of drinking wine", he believes. With ever-increasing tourism and residents, and improved availability of fine Mexican and imported wine, the last frontier is about to fall.

Original Article

No comments: