Georgia’s ancient wine culture is undoubtedly marketing gold, with taglines such as ‘8,000 vintages’, ‘The cradle of wine’, and ‘525 indigenous varieties’. Together with the sacred tradition of making wine in giant buried terracotta vessels (qvevri), this has exalted the country’s artisan winemakers to the status of natural wine shamans. “Wine is born, not made,” they pronounce. And they have become global poster boys (and girls) for all that is authentic, deep-rooted, and raw.
Worldwide exposure seems to be helping sales too. Georgia’s wine exports are booming, with some 50m 75-cL bottles set to earn around $115m in 2017 – a more than tenfold increase since the chaotic first years of independence in the 1990s.
So much for the sales pitch.
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Like most marketing, this romantic tale of clay pots and peasant farmers toiling in the fields is a heavily abridged edit of the full story. The iconic qvevri all but died out in commercial winemaking during the late 20th century. To date, traditionally made qvevri wines account for perhaps 3% or less of Georgia’s total wine production.
What has actually driven Georgia’s winemaking resurgence in the post-communist world? The truth is far stranger, if less beautiful than a qvevri. It’s a tale of soviet destruction, of near total destitution giving way to ambitious entrepreneurs and industrialists, shaped more by politics than culture.
It’s also a tale of mass-produced semi-sweet wine, made to satisfy a thirsty Russian market. This ever-popular product, epitomised by wines such as Alazani Valley (a generic style, even though it sounds like a producer) or Kindzmarauli, represents around 50% of the country’s total output. Russia is still the biggest customer, lapping up about 60% of Georgia’s total wine exports by volume.
The modern wine industry emerged out of a scorched earth scenario after the breakup of the USSR. It then had to weather years of civil war, followed by Russia’s devastating embargo on all Georgian wine between 2006 and 2013. To properly understand this phoenix-like recovery from soviet ashes, it’s necessary to look back to the seven decades when Georgia was subsumed into the USSR.
As the most-important, most-loved wine-producing entity in the Russian hemisphere, soviet Georgia had a thriving wine industry – but the stock-in-trade had little to do with artisan ethics or wines fermented in qvevris. Under soviet rule, Georgia’s grape growers delivered their harvest (mostly of white Rkatsiteli or red Saperavi) to one of hundreds of ‘primary wineries’. These wine factories processed the grapes and turned them into ‘wine materials’ – essentially, bulk wine. This was delivered to a designated ‘secondary winery’, often located in Tbilisi or another big city. Here, the bulk product was processed, bottled, and labelled, and then shipped to its designated destination.
The winery’s name didn’t appear on the label, as all Georgian wine was bottled under the monopoly ‘Samtrest’ label. Differentiation was achieved through style or ‘appellation’. Denominated areas such as Kindzmarauli, Khvanchkara, or Mukuzani were popularised as brands, each with a regulated stylistic signature. Khvanchkara – reputedly Stalin’s favourite – was naturally semi-sweet, Mukuzani was oak aged, Kindzmarauli was dry.
The objective of this highly distributed system was quantity, not quality. Wineries such as Tbilvino, based in the capital Tbilisi, produced as many as 18m bottles a year in their heyday. But after the collapse of the USSR in 1991, these giant wineries fell silent, stripped of their order books, with no sales contacts and no marketable brand identity.
Georgia’s minister of agriculture, Levan Davitashvili, who worked at Schuchmann Winery between 2009 and 2012, recalls that every part of the supply chain was decimated after 1991. “It was a very difficult period, especially for agriculture,” he says. “Most of the land was [re]distributed to farmers. People switched to growing cheap sustenance crops just to feed their animals. No one cared about commerce, so the value chain was broken – including wine.”
This partly explains the extraordinary destruction of Georgia’s vineyards. According to Irakli Cholobargia, head of marketing and PR at the National Wine Agency (the successor to Samtrest), Georgia had around 150,000 ha of vineyards during the soviet era. By 2006, only 36,000 ha remained. “After the soviet collapse, many of the farmers got rid of their vineyards and planted watermelons or whatever. It was a market-economy-driven thing,” he explains.
Those vineyards that survived communism were often in bad shape, as Zurab Ramazashvili, co-founder of Telavi Wine Cellar (Marani) recalls: “We started by renting vineyards from the government, but their condition was devastated by civil war and generally very poor. Old vines, non-standard trellising systems, missing plants.” Furthermore, they were not necessarily planted with the stated varieties. Hybrids were popular during soviet times, while many indigenous varieties were grubbed up in favour of the ubiquitous Saperavi and Rkatsiteli.
To exacerbate matters, soviet viticultural expertise didn’t extend much further than systemic use of herbicides and fungicides. Winemaker Eko Glonti, a medical doctor in a previous life, has been working with growers to restore these chemically dependent vineyards. He notes many issues in the soils, such as compaction and calcium deficiency. “There’s no macrobiology there,” he says with regard to a plot in Kakheti. “There is nothing to help the roots consume minerals, and after the rain the water just runs away.”
The modern era
Post-communism, failing and bankrupt wineries were snapped up by the private sector, as entrepreneurs realised that Russia was still thirsty for Georgian wine. A string of JSCs (Joint Stock Companies) sprang up in the late 1990s, GWS (Georgian Wines & Spirits), Tbilvino, Telavi Wine Cellar, and Teliani Valley amongst them.
The names and company structures might have changed, but the product and its intended market largely hadn’t. Wineries had the legacy of old soviet equipment, and most owned not even a single hectare of vineyards. Corruption was rife, right up to government level, and there was more than a grain of truth in Russia’s accusations about adulterated or fake wine, a problem that has taken decades to stamp out.
Brothers Zura and Giorgi Margvelashvili were shareholders in Tbilvino post 1991. Their story is typical. Zura returned from a winemaking internship in California, inspired to work with wine. The brothers invested the family savings in a share buyout, taking control of Tbilvino in 1998.
As Giorgi recalls, “Tbilvino was not in very good shape in 1998 – it had close to zero production. Contact with former suppliers and customers was lost.” So what had the brothers got for their money? Tbilvino didn’t own any vineyards, but it did boast a winery. Occupying a vast 5-ha site in Tbilisi, the facility was in fairly good shape, albeit with outdated technology. And there was a bonus – 3m L of bulk wine lay in the winery’s cellars.
A cohort of international wine experts were summoned to assess these ‘wine materials’. The advice was brutal: “It’s rubbish, you should not bottle this.” Still, it was a lifeline for the fledging business, as Giorgi recalls. “We managed to sell the wine in bulk and paid off a few debts. With the remaining cash, we went and bought grapes in Kakheti in 1999 and made our first vintage.”
The brothers built Tbilvino up from this unpromising start with a radically different approach to the soviet practice of blindly accepting and bottling bulk wine. The new strategy meant getting involved with the many different growers who supplied the grapes, taking an active part in the harvest, and upgrading the quality of the wine.
In 2006, the company lost around 52% of its business when the Russian embargo kicked in. It turned out to be a blessing in disguise. Most of the Tbilisi site was sold to raise money, and a new, smaller, quality-optimised winery was built. By 2008, Tbilvino had recovered, stronger than ever. Today the company produces around 4m bottles a year and exports to 30 countries.
Many of Georgia’s major wine producers agree the embargo was a vital turning point. Tea Kikvadze, head of marketing at Teliani Valley, says, “With Russia, you could sell everything you had. But with Europe and other markets, you needed quality wine. The embargo was bad for companies, but it was good for Georgian winemaking. It forced winemakers to care about the quality. It has really changed a lot.”
The embargo also forced producers to aggressively court new markets such as China, Poland, and the UK. Since 2013, Russia is back in the fray, but its absolute dominance of Georgia’s wine exports is reduced, down from 90% to 60%.
Sales channels look healthy, but unresolved challenges with wine production persist. The vast majority of vineyards are parcellated up amongst small farmers, making it challenging to control quality. Major wineries like Telavi Wine Cellar and Tbilvino are planting hundreds of hectares but must still rely on a network of small growers to supply 50% or more of their grapes.
Ramazashvili is the first to admit that. “We cannot really control farmers’ grape-growing techniques,” he says, but as Tbilvino owns only 165 ha of young vineyards, they are still heavily reliant on growers. There’s an additional challenge now that grape growers realise they can make better money by making their own ‘artisan’ wines, making vineyards more expensive and difficult to buy. Eko Glonti relates his recent experience securing a 5-ha plot in Kakheti. “It took five years of negotiating with around 35 separate owners!”
There has been an acceleration in regulation and development funding for the wine industry since the regime change in 2012, when the left wing Georgian Dream coalition took power. “To give you an idea of how big this change was,” says Levan Davitashvili, “the total budget for agriculture was ten times less before 2012.” The Ministry of Agriculture has also signalled that qvevri wines might become more important in the future – from the 2018 vintage, traditional qvevri wines are recognised and strictly defined in Georgia’s wine law.
All of Georgia’s largest producers are coincidentally increasing their qvevri ranges due to market demand: Schuchmann’s Vinoterra range will hit 150,000 bottles in 2017. So qvevris are clearly not dead, even if they are buried. Perhaps their production volumes will never reach the same levels as the marketing suggests, but nevertheless, the next decade in Georgia’s winemaking history looks set to be every bit as fascinating as the previous 8,000 years.