Wine is a gigantic business world-wide, approaching $180 bil. just in the value of wines bottled each year. In the U.S alone, a $12.3 bil. retail enterprise in 2005, not counting another $4.1 bil. in imports from other nations. The U.S. also exported $550 mil. worth of wines to the world in 2005. In America wine has risen from a very modest and insignificant commodity from the 1960's on and is now growing at more than 4% per year - perhaps now the largest single agricultural product in the U.S. Wine mirrors world trade. As world trade has increased in the last three decades from $200 bil. to $7 tril., so world wine trade has ballooned. As the world grows wealthier, it will first better feed itself and secondly integrate more wine into its food culture. Growing sophistication in food will be accompanied by more "conspicuous" wine consumption. It is not unreasonable to imagine that in a few decades, wine production and sales could become the most valuable of all the world's single agricultural products; perhaps to equal twenty percent of food costs. This brief article explores the place of wine in the culture of food and the burgeoning economic role of wine in international commerce, but focusing primarily on the future of U.S. wines and the wine business.

The Roots of Wine. The making of wine is among the world's oldest crafts, appearing about 6,500 years ago[1]. Early wines came from Greece, Egypt and adjacent areas of the Near East, as well as the Roman Empire, and was a major trade item from the first-century on. Wine for the first time in human history rendered "water" safe to drink. Grape-growing, some portion of which must have been fermented into wine, probably began in Mesopotamia at least 6,000 years ago. Egyptians and others of the Middle East, Greeks and those living in the Mediterranean Basin soon caught on to the glories of wine. From 1,600 B.C. grape wines spread rapidly to all the regions of Greek influence, including other areas of Europe.

Wine-making as an art form was perfected by the Romans. Under Roman influence, wine consumption increased enormously, in fact, wine became a form of money in foreign trade. Roman inventiveness probably developed all the tools of modern wine-making; the wooden barrel, the glass bottle and that practical "corkage" that inhibited oxidation - a process that turns wine into vinegar. From the 1st-century, Italy became a great wine factory. From hundreds of locations wines were exported to the known world, from Eastern Europe to the Caucasus - to Spain, Portugal, France, Germany and England. Countries without vineyards, Ireland, Holland and Scandinavia, also imported Mediterranean wines. With local adaptations and experimentation, vineyards were developed in France, Spain Portugal and Hungary. Because of even better microclimates, by the 10th-century, France rose to dominance in the production and export of wine. The five magnificent and unique growth areas of France[2], Burgundy, Bordeaux, Champagne and the Rhone and Loire Valley's still produce some of the world's most distinguished wines. During the Age of Exploration that included the conquest of Mexico and South America by both Spain and Portugal and parallel colonization by the Dutch in South Africa, wine grapes came to be introduced to southern Africa, as well as Mexico, California, New Mexico, Texas, Chile, Argentina and other areas of the New World. During the 17th-century, wines met "competition" as other "safe water" appeared with large batch beer and distilled spirits, as well as coffee and tea. Vines were introduced into Australia in the late 18th-century and after 200 years have developed a character of their own. Wine grapes were introduced into California early in the 19th-century. Contrary to popular opinion, the Napa Valley did not pioneer early California wine production. In fact, Sonoma has a history of wine production that precedes Napa by almost a half-century. The Russian colony at Ft. Ross were producing quantity wine by 1812 and from 1824 on, Frere Jose Altimira, who built Mission Sonoma, might be recognized as the "father of California wines." The cultivation of wine grapes and the production of wine is on a "tear" worldwide. Eastern Europe, from Hungary to Georgia is raising the quality and quantity of their wines. In the New World, Argentina, Brazil and Uruguay have joined Chile as expanding producers of wine. Australia and now New Zealand have also developed large wine industries. China has become the fifth largest grower of wine grapes. It is the United States in the last 15 years, however, that has had such a dramatic impact on the world's wine industry.

What is Wine? Wine is rooted in the cultivation of grapes and some other fruits. The growing of grapes specifically for wine production, viniculture - while the specific chemistry of wine is called oenology[3]. Wine results from the fermentation of sugar into alcohol (ethanol) stabilized by tartaric acid[4]. All primates, man included (and most birds), are by nature drawn to the aroma of ethanol, the natural alcohol from, especially, fermented fruits[5]. We can only speculate on the earliest relationship of "man to wine." In the intervening millennia, three types of wine have been developed, red, white and rose, and each of these may be "dry", "medium," or "sweet." There are further two kinds of natural wine: still wine and sparkling wine (a third, "fortified wine" is made by injecting distilled alcohol to attain unnaturally high alcohol levels). As a general rule, red wines are made from red grapes and white wines are made from white grapes. Exceptions exist. Some white wines are made from red grapes, where the coloring agents in wine skin are removed to retain "whiteness." Both kinds of natural wines are made in the same general manner, except that sparkling wines undergo a "secondary fermentation" (called the malalactic fermentation) that creates carbon dioxide gas under pressure. Natural wines contain from 8-16% alcohol by volume, depending on the style of wine being created. The "quality" of a wine is unrelated to its alcohol content, however, as a rule white and sparkling wines tend toward lower alcohol content. Another prevalent myth is that "sweet" natural wines are of lower quality. Quite to the contrary, some of the world's most distinguished and expensive white wines are made from Reisling grapes, grown along the hillsides overlooking the Rhine Valley, in Germany[6]. Wine and its consumption is sometimes accompanied by elaborate rituals, many evolving from the late Middle Ages. In truth, wine may be enjoyed in utter simplicity rather than draped in rituals of acquisition, storage, tasting and consumption. It is true that traditionally wine consumption and the culture and conviviality surrounding wine and food, stimulate the artistic senses of sight, smell, taste, touch and sound. Clearly, this contributes to the enjoyment of wine beyond its alcohol content. In our modern, fast-paced world, wine will increasingly be cited, not alone for stimulating conviviality, but for the contribution of micronutrients wine may contribute to human health[7]

The barriers to increased wine consumption in the U.S. remain first and foremost that about a quarter of all wine consumers are intimidated, literally overwhelmed, by wine culture. For wine and its "culture" to move toward the next stage of acceptance, wine must be demystified - it must become again a simple food; accessible to all, in an environment that does not intimidate. According to a recent survey, 23% of wine consumers in the U.S. describe themselves as "Overwhelmed"[8]. The Overwhelmed are joined by five other self-described consumers. "Enthusiasts" are those passionate about wines and inclined to be quite experimental. They are also willing to try the most expensive vintages; many no bargain at all. "Image Seekers" are wine drinkers with a tendency to admire overpriced wines; prey of the wine marketing racketeers, those who formerly sold Swiss watches! Image-Seekers willingly perpetuate many of wine's legacies of myth. Then there are the "Traditionalists," the most focused of wine consumers. They tend to favor well-known labels, well-known vineyards, and particular grapes or varietals. "Savvy-Sippers" are the "gyroscopes" of wine consumption, helping to keep the rest of us balanced. You know who they are, you find them at every major new shipment to Trader Joe's. Their Internet connectedness enables them to cause a run in one day, on all 2000 cases of any good wine meeting their strict "value" criterion. Our last class of consumer has been called, the "Easily Satisfied Imbiber." They tend first and foremost to be price sensitive. They are the reason that Franzia in a box is the world's largest selling wine brand! It is not that Easily Satisfied Imbiber's are necessarily undemanding, many practice strict wine style or brand loyalty. It is rather that they emulate those to whom food is just fuel; where "good" does not have to be very good. It is the Baby-Boomers (those born between 1946 and 1964), America's most conspicuous consumers who have aggressively entered the marketplace for "class, style and elegance;" why wine appreciation in the U.S. has grown exponentially. Wine better matches and complements food than either beer or spirits. Wine production and consumption patterns parallel the world-wide growth in food sophistication, increases in international trade and increased world wealth. Wine has become and is likely to become even more so, another convivial food, perhaps explaining the dramatic drop in per capita spirits consumption and significant decline in per capita beer consumption, worldwide. As the 20th-century closed, the world's most honored wines came from France, Germany, California - and increasingly the Pacific Northwest - Washington and Oregon[9]. Europe, however, remains the "giant." Europe collectively produces 59.7% of the world's wines, a percentage that had declined somewhat each of the past several years. In contrast the U.S. produced 11.1% of the world's wines, but this figure had risen every year for the past 30 years. The growth of viniculture, winemaking and wine consumption continue to closely track the rising influence of Western civilization.

Wine in the 21st-Century. Wine has becomes such a huge world-wide industry, that wine grapes, wine production and wine consumption have become a major factor in agriculture. Data on world wine ("guess-estimates," actually) suggest world production as exceeding 7.1 bil. gallons; 35.8 bil. bottles[10]. It takes little imagination to calculate a retail value for the industry by imputing a conservative $5 to a hypothetical bottle. Currently the U.S. produces about 16% of the world's wine, and arguably about 20% of the world's highest quality wine - much of this exported. The largest domestic producer states are California, Washington and New York. Both California and Washington have wine industries that will ensure the future prominence of American wines. By 2008 it is estimated that the U.S. will consume 25% of the world's wine, up from 19% in 2004 (Wine Institute, April, 2001).

As the 21st-century opens, America has become the boldest adventurer in both foods and wines. Higher quality foodstuffs are available now in the U.S., across the board, than anywhere else. As foods lead, wines follow, eventually to become so intertwined that wine will become again another food. During 2005 the U.S. exported $800 mil. worth of wine, while importing $5.8 bil. The dramatic imbalance between imports and exports should keep American winemakers busy through this century. By 2099 it is probable that Washington State wine grapes will dominate U.S. production, eclipsing California by mid-century and leaving New York a very distant third. There is almost no limit to the acreages in Washington suitable for viniculture. Climate, soils, temperatures, humidity, growth days, terrain, hillsides, eroded scarps and inexpensive, suitable agricultural land provide excellent conditions for wine grapes[11].

Today the U.S. produces over 600 mil. gallons of wine, most of which is consumed internally, plus we import another 158 mil gallons, most of this from France. By the end of this century the U.S. will probably become the world's largest wine producer, followed by France, Italy and Spain, with China, Australia and Argentina vying for fifth place. The world's great traditional producers, France, Italy and Spain, will with time, continue to lose their historic place. The reasons are not xenophobic and the evidence is clear. Firstly, wine-making simply stated is chemistry. American ingenuity has come to the forefront of wine-making and this creative energy will be difficult for other nations to emulate[12]. In the second place, Europe as a region has, in the guise of the European Union, created for itself both excessive competition (through subsidies and inefficient agricultural practices) and mind-numbing internal regulation. The final toll will be felt as the rising cost of viniculture land succumbs to the pressures of development[13]. Attempts to stem this inevitability by additional "rule-making" cannot succeed. The U.S. produces 3.2 mil. tons of wine grapes and capacity increases five percent, per year (2005);a crop value of $23.2 bil. The value of our wine grape production has doubled in the past ten years. In 2005, we produced 623 mil. gallons domestically, and consumed at total of 668 mil. gallons, the net of exports minus imports. We exported from the U.S. 119 mil. gallons with a value of $794 mil. Last year California shipped 522 mil. gallons to consumers worldwide. The California wine business alone had an economic impact in California for 2005 of $45.4 bil. The U.S. is now the world's third largest consumer of wines, after France and Italy; and the fourth largest producer of wines, after France, Italy and Spain. U.S. wine consumption rises about 4% per year such that in 2005, we consumed 285 million cases (677 mil. gallons); a case of wine per man, woman and child in America. By 2015, wines sales will rise to an estimated 325 million cases (773 mil. gallons) and by 2030 to 425 million cases (just over 1 bil. gallons).

As wine becomes more "democratically" appreciated and consumed, many of the artificial barriers of wine snobbery will fall. Even in wine, the invisible hand of the marketplace rules. Where particular wines become well known and respected, there is the inevitable temptation to create "value" by marketing them at astronomical prices. In this sense wines are similar to perfume; the costs of production are small, but marketing to secure sales often consumes ten times the cost of production; even more. A case in point; currently the world's most costly wines come from Bordeaux. A combination of French marketing skill has gotten wholesale prices of premium Bordeaux above two hundred dollars a bottle. With a dozen of the world's nation's now producing some premium wines and this competition increased by a not insignificant "boycott" of French products over the past three years, along with a huge 2004 grape crop finds Bordeaux in crisis. Sales of their wines have declined 1.3 mil. cases between 1999 and 2003. Bordeaux has lost 4,000 vineyards in the past four years; down to about 10,000 as we write (Wine Spectator 11/30/05).

Wine, like all art and craft forms follow money. The consumption of quality wines closely mimic America's growing food sophistication. In only a few years (perhaps, 2008-2010) the U.S. will consume 25% of the world's "best" wine. American ingenuity and our stunning educational programs in viniculture and oenology have brought us into the forefront of world-class winemaking, after 200 years of experimentation. The Baroness Philippine de Rothschild famously reminded us that "making wine is a simple business. Only the first 200 years are difficult."

[1] We can be certain, on archaeological evidence that other 'fermented crops,' such as grains and honey are older technologies than wines made from grapes, even though grape vines in fossilized form that are 60,000 years old have been found.

[2] In this review, I'm excluding two little-known areas, The Languedoc and Provence; 'official' areas in France's arcane and cumbersome system of agriculture and viticulture.

[3] Viticulture is the science of cultivating grapes for wine, while oenology is the science of wines and wine chemistry. Today the term 'viniculture' is replacing 'viticulture.'

[4] Tartaric acid is the dominate acid in wine grapes. In fact, it is found in large quantities only in grapes. Tartaric is a rather complex 4-carbon, 4-oxygen, 6-hydrogen molecule, that lends 'crispness' to wine, aids in creating character during aging, and acts as a preservative.

[5] The nearly infinite variety and character of wines result from the chemical elements of grapes, as modified by fermentation and the 'magic' of the winemaker. The relative specific chemical constituents of an individual wine vary by grape variety and the industrial chemistry applied to its manufacture. Natural wine (wine that has not been 'fortified') is typically 80-90% water and about 8% to 16% alcohol (although wines above 14% may not be called table wines). Additionally, wines have large proportions (100 mg/l to 8,000 mg/l) of phenolics (including tannins), glycerols, amines, amino acids, sorbitols and mannitols and smaller quantities (less than 100 mg/l) of sulfites, acetdehydes (carbonyl), esters, aromatics (benzenes, toluenes and zylenes) ketones, and 'higher alcohols' (known as fusel oils), in addition to tartaric, malic, lactic and citric acids - more than a thousand elements and compounds all together.

[6] The most brilliant of these late harvest wines include Trochenbeerenaulease (TBA), wines made from grapes that are left on the vines to 'raisin' and are then hand-picked, grape by grape, to produce wines in their finest vintages that sell for several hundred dollars per half-bottle! These and other German dessert wines are among the most extraordinary examples of the wine-making craft.

[7] This is sometimes called The 'French Paradox;' referring to the interesting medical conundrum as to why the French people who both consume more red meat and smoke cigarettes far more than, say, Americans (and additionally consume very large amounts of wine, per capita), have fewer heart attacks, less congestive heart failure, fewer body cancers and lower cholesterol levels. The answer appears to lie in the fact that consumption of moderate amounts of red wine daily significantly reduces cardiovascular disease and some other conditions of aging. Medically, red wines (in their natural state) contain significant antioxidants that reduce fat formation within arteries and may inhibit the growth of certain cancers. There is further evidence that wine imbibers have reduced brain deterioration due to aging.

[8] The six terms used in this discussion and their implications are taken from 'Project Genome' (October 25, 2005), by Constellation Wines U.S., the largest study of wine consumers ever undertaken.

[9] In fact, it is probably Italy that makes the greatest undiscovered wines. Unfortunately, the Italian wine industry is highly decentralized and disorganized with thousands and thousands of tiny vineyards, many producing mind-boggling vintages - wines all but unknown to the general marketplace.

[10] World wine data come from the Office International de la Vigne et du Vin (O.I.V.). U.S. data are very accurate and complete. The major sources are USDA and the Wine Institute.

[11] For the very best wines, large areas of inexpensive land and suitable climates are not enough. The severe winters in Eastern Washington make possible 'hard' wines, analogous to those produced in the three northern regions of France. Such harsh conditions lend themselves to more enduring wines than the 'soft' wines of Australia, New Zealand and South America. For instance, South Africa has limiting climatic conditions and although producing quite decent wines, has not produced distinguished wines despite 300 years of wine-making.

[12] In the past forty years higher education in the U.S. has come to accept both viniculture and oenology as worthy sciences. In America 70 agricultural schools grant degrees in the arts and sciences related to wine - more schools than the rest of the world combined! France has had a great school of viniculture for 150 years, but no institution is likely to match the University of California at Davis. U.C. Davis is the 'Mecca' of viniculture and wine-making. Davis students now include dozens and dozens of undergraduates and graduates from France, Australia, Spain and the wine countries of Eastern Europe. Davis graduates are now Winemaker for many, many domestic prestige wineries and are Vinemaster or Winemaker at some of the world's most prestigious wineries, including some in Burgundy and Bordeaux.

[13] Quite similar to what is happening today in the Napa Valley. Viniculture is an extensive agricultural practice, one requiring large amounts of relatively low cost land, no longer practical in Napa County. This is reflected in the fact that wine today is produced in 46 of California's 58 counties. Many had no producing vineyards ten years ago.

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