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Wineries offer premium brands to Cuban tourist sector
CubaNews / October 2002

By Larry Luxner

HAVANA -- Passing by the Southcorp Wines booth at last month’s food expo in Havana, President Fidel Castro stopped to sip a glass of Seven Peaks Cabernet Sauvignon.

“Fantastico!” Castro told Ignacio Melero, Southcorp’s Miami-based sales director for the Caribbean and Latin America.

Melero, interviewed a few hours later, said while Fidel’s enthusiastic reaction to the California varietal didn’t translate into immediate sales, the very idea that U.S. wineries may now export their products to Cuba for the first time in 42 years is encouragement enough.

“We don’t have great expectations,” he said. “But the fact that Fidel told us we have fantastic wine is a great testament.”

Southcorp was among half a dozen wineries to participate in the U.S. Food & Agribusiness Exhibition, held Sept. 26-30 in Havana.

“Wine is a food product, a byproduct of the grape,” Melero told CubaNews. “So anything that’s sourced from the land is allowable in this fair” — and permitted to be sold to Cuba under the U.S. Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA).

Yet Southcorp said products like Seven Peaks — which would sell here for $30 a bottle — are way beyond the budgets of most Cubans, who don’t even earn $30 a month.

Rather, Southcorp’s wines would be targeted at Canadian and British tourists.

“Our Penfold’s and Rosemount brands are phenomenally successful in Canada and England, and those countries are a big source of tourism in Cuba,” said Melero. “This would be totally tourist-driven, because of the price structure. But if it becomes a mainstay in the tourist industry, it will eventually trickle down to the domestic consumer.”

For Laurence D. Pollack, CEO of Caravelle Wine Selections, the Cuba food show marked the first time his company had ever participated in an expo outside the United States.

Pollack, based in Avon, Conn., represents two California wineries, Burgess Cellars and Girard, which sell in the $15-40 range.

“In Cuba, our wines will probably be sold for the same price points,” Pollack said. “Our market is hotels and fine wine shops. There are 89 hotels in the four- and five-star category, and we’ve been talking with Alimport for quite a long time. This could be an important market for us if Cuba opens up. Even now, we’re establishing important relationships.”

Helping exporters like Melero and Pollack is the fact that tropical Cuba has never had much of a domestic wine industry to speak of.

“Our wine is bitter, but it’s our wine,” declared independence hero José Martí 100 years ago — in a patriotic refrain long associated with Cuba’s defense of national values.

Although Cuban officials have tried for sev-eral years to cultivate vineyards, industry experts interviewed here say those efforts are unlikely ever to bear fruit.

“Cuba could never develop a good wine, because they’re not in a good climate,” says Melero. “Cuba is good for sugar and rum, but grapes are the wrong crop for this latitude.” Adds Pollack: “Cuba is supposedly starting to make some wine. But you don’t wind up all of a sudden selling wine. The products we’re presenting here are all very premium wines.”

Richard H. Moore, international director for California’s E & J Gallo Winery, said his company — the world’s largest vintner — sells 61 million cases a year and exports to 92 countries. Cuba is not among them.

“My personal opinion is that the Cuban market won’t be too large. I don’t think the locals can afford it,” he said. “‘I think it’s more a market of the future, maybe a container or two per year in the beginning.”

Moore, who is based in Fort Lauderdale, Fla., said he expects Gallo will retail in Cuba from $6 for a bottle of Carlo Rossi up to $27 for a Sonoma Cabernet Sauvignon.

Stephen J. Eisenhaure, an independent broker representing Stimson Lane — which bottles Columbia Crest and Domaine Ste-Mich-elle — also hopes to get a piece of the pie.

“We’re very small. We’re going after Cuba’s 1.75-million tourist market, which is the same size as the Virgin Islands tourist market,” said Eisenhaure, whose wines retail in the United States for anywhere from $9 to $40. “So far, the reaction here has been good, though it’s difficult to judge who’s tasting our wines. They’ll taste anything you give them.”

He added: “If I sell anything in the local market, it’ll be a bonus.”

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