Grape expectations: Brazilian vineyards, small in number, market themselves to global palates

Latin Trade,  Nov, 2005  by Carlos Adese

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Brazil wants to join the ranks of Chile, Argentina, New Zealand, Australia and South Africa and convince drinkers worldwide to try their domestic wines. Even without the centuries of tradition that European winemakers have under their belts, emerging wine-producing countries have managed to get the wines into the glasses of the world's most demanding consumers.

But how can a tropical country like Brazil export a sophisticated and temperate product like wine? The Brazilian Wine Institute, a national association of vineyards, and Apex, Brazil's export agency, have joined forces to find out. Six vineyards, all from Rio Grande do Sul state and responsible for 90% of the nation's wine, are spearheading a marketing campaign to do just that.

The project will market all of Brazil's main vintages under the banner Wines from Brazil at international wine shows. Brazil is still an importer of wine and a blip on the radar of the global wine market. Australia, for example, exports US$2 billion a year. "Technologically, we are behind in terms of export strategy," says Eduardo Stefani, trade promotions manager for Wines from Brazil. Nevertheless, the group is betting long; they expect foreign sales to grow 30% a year. The vineyards hope to send abroad $840,000 worth of wine by the end of 2005 and, by 2006, to ship out $1.1 million. In 2004, total exports including cheaper, mass-produced table wines was $1.8 million.

"We alone didn't have the strength to move forward. It was this project that took us to the world," says Juarez Valduga, president of the Casa Valduga vineyard in Bento Goncalves, Rio Grande do Sul state, whose 50,000 bottles in exports in 2004 accounted for 5% of total volume. The vineyard expects Wines from Brazil to raise exports to 20% of all bottles sold by 2006.

Once the word is out that Brazil makes fine wines, the second step is to position them as the newest member of the exotic New World wine-producing countries, says Valduga. "There has been a global trend to seek out wines from countries people didn't know were wine producers," he says. "People are surprised by the quality of Brazil's wines."

Some want exactly that--a surprise. Vineyard Casa Aurora wants to use Brazil itself to entice international customers. To do that, the vineyard has distributed its finest wines to bars and restaurants frequented by tourists from abroad, most of them visiting in Rio de Janeiro. "We're in the places where the tourists go and they are giving us something back by trying our products. It's slow, painstaking work," says Flavio Zilio, Casa Aurora's oenologist.

The hope is that the tourists enjoy what they try and take note so that when they return home they'll look for Brazilian wines in their local stores. "Europeans have a very large and established wine culture, and when they come to Brazil, they have no idea that wine is made here," says Zilio.

Industry experts say that Brazilian vineyards must do more than just sell more abroad. Some say Brazil needs to go out of its way to change its image, too. "It's necessary to differentiate oneself, to see how a grape can be emblematic and become what the market is looking for. It's a search for newness," says Hugo Casanova, head of Vina Hugo Casanova, a fourth-generation Chilean vineyard in the Maule Valley.

Niches. Parts of the Chilean story are repeating in Brazil, like at the Casa Miolo vineyard, which in 2004 took in more than $21 million and exported 95,000 bottles of wine and sparking wines. With prices ranging between $2 and $10 per bottle, Miolo's executives think growth will come from breaking away from the pack. "We are trying to discover a niche in each market," says Fabio Miolo, commercial director at the vineyard, which aims to triple its output in 10 years to 15 million bottles a year.

Early results are starting to come in. In the first half of the year, the vineyard signed its largest single export contract in the toughest wine market in the world: France. The deal with Casino, a French supermarket chain and partner of Brazilian retailing company Pao de Acucar, is a single order of 68,400 bottles. The vineyard hopes the French take a liking to Brazilian wine, even if it takes a while. "Brazil is not just about caipirinhas and samba," says Miolo. "We have wine, too."

CARLOS ADESE * SAO PAULO

BRAVE NEW WORLD

Argentina and Chile figure, but Italy and France lead the
world in wine exports.

Italy          21%
France         19%
Spain          19%
Australia       8%
United States   6%
Chile           6%
Portugal        4%
Germany         4%
South Africa    3%
Argentina       2%
Others          8%

SOURCE: Global Trade Atlas

Note: Table made from pie chart.

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