Blog: Sharon Kegerreis & Lorri Hathaway

With wine grape harvest well underway and snow soon to drape Michigan's vineyards, let's hope for a rosé forecast for vintage 2010. Wine writers Lorri Hathaway and Sharon Kegerreis, co-authors of The History of Michigan Wines, will cover the state's trial-and-error wine industry and toast its status as a world-class wine and food destination.

Post 2: Michigan Vinters Face Production Challenges

Michigan wine production was at its peak during the 1930s through 1960s, reaching 1,000,000 cases of wine. Remarkably, Michigan's 73 wineries of today are producing only half this production, or 500,000 cases. This decline was caused by detrimental obstacles challenging the industry through the 20th century. Fortunately, passion and perseverance of Michigan vintners have evolved wine production into the modern, thriving growth industry of today.
Consumer Preferences

Sugar rationing during World War II prompted the mass production of sweet, cheap, and fortified wines for at least two decades in the post-Prohibition era. When the war ended, however, a new trend began penetrating the American market. Returning soldiers, exposed to Old World styles of wine in Europe, preferred these drier-style wines. Also, new celebrities, like cookbook author and television personality Julia Child, educated Americans on how to cook and pair wines with food. American wine drinkers become savvier and more knowledgeable, and the demand for palatable table wines was on the rise. In 1969, the consumption of table wines surpassed sweet wines for the first time in the nation's history.

Michigan winemakers recognized the changing market, and as early as 1957, the state's nine wineries started a commission of experts to conduct blind tastings of their wines and evaluate the quality. Three years prior, Baco Noir was planted by Bronte winemaker Angelo Spinazze for the production of the state's first table wine.

A Detrimental State Regulation

Unfortunately, a detrimental law change in 1972 shut down operations for some of Michigan's biggest wineries, nearly stomping out the industry. Law 16A increased the amount that wineries needed to pay farmers for grapes to receive a much-needed tax break. The requirement, which had changed six years prior from $55 to $85, was now $100 per ton. The tax break allowed for a reduction of forty-six cents per gallon, provided the wine was less than 16 percent alcohol and was made from 75 percent Michigan-grown grapes.

By 1973, production had significantly dropped to only 600,000 cases. Michigan’s in-state market share, which was once 80 percent, dropped to less than 30 percent by 1975. The drop continued through the rest of the 1970s, bottoming out at 250,000 cases.

Fortunately, two of Michigan's post-Prohibition wineries, St. Julian Wine Company and Warner Vineyards, survived these financial challenges and began producing palatable table wines. Also, new wineries opened, including Tabor Hill and Chateau Grand Traverse, after planting acres of hybrid and vinifera grapevines. A new era for Michigan vintners was ignited.

Distribution Challenges

Linda Jones, program manager of the Michigan Grape and Wine Industry Council, says that the state's wine industry has grown 10-15% in sales per year over the past 15 years. Today, Michigan produces about 500,000 cases a year and continues to face several obstacles, the biggest being distribution. Most of Michigan's wineries are small, boutique wineries that produce less than 5,000 cases a year, making it cost-prohibitive to hire distributors.

"The ability to ship wines direct from wineries to our consumers is essential for us and for our loyal consumers," explains Don Coe, co-owner of Black Star Farms of Suttons Bay and commissioner for the Michigan Department of Agriculture. "We are dependent upon our tasting rooms to introduce products. However, we are not close to those consumers and our wines are not in broad distribution. The consumer is king and should be able to get the wine they want, when they want. Consumers need to join us to ensure that artificial barriers are not allowed to limit these sales to benefit extraneous business interests."

Interestingly, Michigan previously had shipping laws that were discriminatory and anticompetitive. In 2003, Eleanor and Ray Heald led the charge to strike down the anti-commerce law by suing the state of Michigan. As wine writers, they often ordered wines from around the world, but Michigan's antiquated laws prohibited the direct shipment of wine from other states to consumers living in Michigan. This also meant that most other states denied Michigan wineries the right to ship into their states since shipping was not reciprocated. After a long battle and an appeal by the state of Michigan, the U.S. Supreme Court decided in favor of the Healds on May 16, 2005, stating that Michigan's direct shipping laws were, indeed, unconstitutional. The initiative and persistence of the Healds opened new market opportunities for the state's wineries.

Coe says, "There are ample opportunities for growth for Michigan wineries as only six out of every 100 bottles of wine consumed in Michigan are produced in Michigan."

Michigan Wine in Restaurants

One opportunity is to grow the number of restaurants serving Michigan wine. Can you imagine visiting a Napa Valley bistro and not having your choice of an impressive list of California wines?

Some Michigan restaurants are responding well to consumer demand for locally-sourced foods and wine. The opportunity for growth, though, is astounding. "Restaurants in the know are featuring Michigan wines," says Master Sommelier Claudia Tyagi. "My modus operandi in restaurants is to feature wines by varietal. So, for instance, you'll see a listing of pinot grigios, chardonnays and pinot noirs. I always make sure there are three to four Michigan wines by the glass. Larry Mawby's sparklers are always wonderful; in particular, we serve Blanc de Blanc to people from all around the world."

Tyagi recommends Forest Grill in Birmingham, Coach Insignia on top of the Renaissance Center in Detroit, and Northern Lakes Seafood in Bloomfield Hills for a respectable listing of Michigan wines. For a list of restaurants serving four or more Michigan wines, visit the Michigan Grape and Wine Industry Council's website.