By nearly every measure, the wine “industry” in Arizona has finally taken off. After 20 difficult years of slow growth and poor marketplace acceptance, the past 5 years have seen exponential growth. Sales, fruit production, taxes collected and new winery business starts have all increased by 400% or more since 2003. Arizona wine is being sold in fine restaurants and at specialty retailers and wine bars in the Phoenix and Tucson Metro areas and across the state. Many of these placements are in restaurants acclaimed by national wine publications that attract a wide variety of patrons from around the world. Placement of local wine in restaurants is probably the most difficult sale for wineries and reflects the quality improvements of many Arizona labels of the past few years.
The retail placements are no different. A.J’s Fine Foods and Whole Foods Markets are two large wine retailers that have been very supportive and are selling Arizona wine at an increasing rate in special merchandising sections. Specialty retailers are doing very well with Arizona wine as well. Much of this is being driven by media reviews of Arizona wine that identify many of our labels’ quality as competitive in the world market. Robert Parker with the Wine Advocate has reviewed many Callaghan Vineyards wines and rated them highly. Dos Cabezas Wineworks has enjoyed the attention of the Wine Spectator and the Wine Enthusiast. Mark Tarbell of the Arizona Republic has reviewed Page Springs Cellars, Pillsbury Wine Company and many others. The Wall Street Journal, Arizona Highways, Sunset, the list goes on. Also helping Arizona wines’ acceptance are changing views about local farm products. People view local products as more environmentally responsible as well as supportive of a sustainable local economy. Arizona wine is beginning to fill that niche.
Just 5 years ago, the opportunities to visit vineyards and tasting rooms in the state were very limited. In 2002, there were only 9 licensed wineries in Arizona and less than a handful had tasting facilities open to the public. No real “clusters” of tasting rooms existed that allowed for the generation of tourism related activity that allows for the economic impact that fully developed state and regional wine industries can bring. Today, there are 28 bonded wineries in Arizona and there are three growing regions that have clusters of tasting facilities. Sonoita/Elgin, Sedona/Cornville and Willcox have emerged as the places to experience Arizona’s wine country. The spin-offs are significant. Wine Business Monthly’s latest national tasting room survey indicates a majority of gross sales for small wineries in the United States comes from their tasting rooms. When wine patrons come to visit, they eat in local restaurants, stay in local lodging, buy local fuel for their vehicles and visit other attractions in the area.
There are many other areas of progress. The Arizona Wine Festival, produced by the Arizona Wine Growers Association (AWGA), is held twice a year, since 2005, at the Tempe Festival of the Arts on Mill Avenue in Tempe. The art festival attracts 250,000 art and wine patrons each weekend and the wine festival introduces Arizona wine to thousands of tasters. The AWGA is adding a new wine and art festival in Willcox on October 18/19, on historic Railroad Avenue. One measure of progress and success is the development of a real estate market for vineyards, wineries and prospective vineyard land. Three years ago, no one was marketing wine-related real estate in Arizona. Now there are several firms that at least recognize and some that specialize in vineyard property. Better yet, there have been significant vineyards and wineries sold in the past 2 years, further validating the value of the industry. We even have mini-subdivisions surrounded by vineyards being developed for those that prefer wine to golf!
What has been the impetus for all this growth? First, small wineries are opening up in every state, including Alaska! This is a national trend and the lure of the wine and vineyard lifestyle has attracted millions of dollars in investment to the industry here in Arizona and across the nation. Second, prospective vintners have discovered that Arizona has the ability to grow world quality grapes. Our warm days and cool nights at the mid-altitudes is perfect for winegrowing. Third, the relative costs are less and the remote nature of our vineyards and dry climate reduces pests and fungus problems many other areas struggle with. Finally, we have a beneficial regulatory environment in Arizona that allows our farm wineries many business rights other states may not enjoy.
Back in 1982, shortly after the Farm Winery Act was enacted in the Arizona Legislature, the Arizona Wine Growers Association was formed by a small group of Elgin growers led by Dr. Gordon Dutt, the person most responsible for the establishment of winegrowing in Arizona. Today, nearly 70% of all Arizona bonded wineries are members of the association. All volunteer, the AWGA has been instrumental in attracting the media, stimulating investment and is almost totally responsible for the wine laws on the books here in our state. The AWGA, growers working together without professional staff, but with the tremendous guidance of our legal counsel, Robert Lynch, passed legislation in Arizona in 2006 to preserve and expand our rights when many states saw their wineries’ business rights crushed by lawmakers in the wake of the 2005 U.S. Supreme Court Granholm decision. Over the last few years, we have worked closely with the Arizona Department of Agriculture regarding Pierce’s Disease and the infestation of the Glassy-winged Sharpshooter (GWSS). The Department, at our recommendation, enacted a nursery plants’ quarantine from 7 counties in California known to have GWSS infestations. The Department also conducted an aggressive and expensive eradication campaign of GWSS after an outbreak was discovered in Sierra Vista. There is more. The AWGA conducts events, promotes our industry, manages the Governor’s Choice Awards to recognize excellence of our winemakers, educates newcomers on viticulture and winemaking and hosts the number one visited wine website on Arizona wine. To find out more about the AWGA, visit us at ArizonaWine.org.
Article by Rod Keeling, Keeling Schaefer Vineyards
Originally Published in Arizona Vines and Wines Fall 2008 Issue