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Carolina Wine Brands Bolsters Chile’s Fine Wine Image With Upscale Moves

September 16, 2015

As Chile aims to drive its image upscale in the global wine market, Chilean winemaker Carolina Wine Brands has been taking up the challenge.

“Too often Chile was viewed as a player that just filled the gap with value-level supply when California fell short—and the big box stores still carry magnums of Chilean Pinot Noir for $7,” says Carolina Wine Brands managing director Santiago Larrain. “But we’ve undertaken initiatives to strengthen our presence at the $12-$30 price tiers and above. Over the past decade, we’ve invested around $60 million in our wineries, vineyards and in research and development.”

Since parting ways with Constellation Brands in the U.S. market in 2006 and forming import subsidiary Carolina Brands USA, the company has shifted its portfolio mix. “We started focusing on wines that we wanted to show, and not on what Constellation thought they could sell,” says the group’s commercial director Christian Wylie. “We’ve since gone from 100,000 cases of mostly 1.5-liter wines in the U.S. to about 150,000 cases of premium Santa Carolina wine.”

The U.S. lineup is led by Santa Carolina Reserva de Familia ($25), which features a Chardonnay, Cabernet Sauvignon, Pinot Noir, Carmenere and Malbec. There’s also VSC ($50), a Petit Verdot-based Meritage. Further up the ladder is Herencia ($99), a luxury Carmenere. Herencia was the portfolio’s most upscale label until the recent release of Cabernet-based Luis Pereira ($150), named for Santa Carolina’s founder.

Luis Pereira, whose inaugural vintage is 2012, has an unusual provenance. After Chile’s earthquake in 2010, workers uncovered a hidden chamber in Santa Carolina’s cellars that contained wines from the ’50s, ’60s and ’70s. The discovery inspired the company to conduct an in-depth study of how those wines were produced—a project that included research into its oldest pre-phylloxera vineyards in Maipo, Colchagua and Maule. “Luis Pereira is an effort to create a wine based on that detailed research,” says wine director Andrés Caballero, who was particularly inspired by Santa Carolina’s 1959 vintage. Some 3,000 bottles of the highly allocated Luis Pereira 2012 were released.

“With Luis Pereira as our icon Cabernet, we now have eight wines at the upper tiers,” says Larrain. “At the highest pricing levels, our wines are super-icons that also offer great value. We won’t be selling huge volumes of Luis Pereira, but we’re showing what Chile—and Santa Carolina—can do.”

Another key to the company’s quality efforts is boutique vineyard Viña Casablanca, a 156-acre property in Chile’s Casablanca Valley known for its cool climate reds and Sauvignon Blanc, all produced under a joint venture with Domaine Laroche. The key label is Nimbus, whose single vineyard wines include a Sauvignon Blanc ($20), Pinot Noir and Syrah (both $30). Casablanca’s other labels include Neblus ($40) as well as the new Pinot Noir del Cerro ($80). Carolina also owns Argentine label Finca el Origen from Mendoza’s Alto Uco Valley, focused on single vineyard wines at the Reserva and Gran Reserva tiers.

Carolina Wine Brands USA sells about 300,000 cases annually, including 170,000 cases from Santa Carolina, 60,000 cases from Finca el Origen and about 10,000 cases from Viña Casablanca. The company also markets Veneto label Famiglia Pasqua, which sells about 60,000 cases in the U.S., and Rioja’s Baron de Ley, which joined the portfolio earlier this year.

“Our goal is to reach half-a-million cases in the U.S. market by 2020, with our brands accounting for about two-thirds of that,” says Wylie. “That would represent organic growth of around 18% annually, and that has more or less been our trend.”

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