Lanzarote Wine Enters a New Age
Our company, through Wine Tours Lanzarote, has been providing specialist wine experiences for over 6 years, and since 2020 we have also been active with our UK based e-commerce business, Wine Shop Lanzarote.
Before going any further, I should point out that this article is a continuation of an article I wrote in December 2022, "An Economics 101."
In the relatively short space of time we have been operating, we have seen a rapid evolution of the wine industry in Lanzarote. During our wine tours, we have always talked about the innovation, investment and evolution that has been apparent in the island´s wineries since the early 2000’s, but we are now riding the crest of a new wave. In our view it is taking Lanzarote wine along a new and exciting course, and it has to be said, at quite a rate of knots.
In 2017, when we launched Wine Tours Lanzarote, there were 14 commercially producing wineries within the Lanzarote Denominación de Origen. At the time, the last winery to join was Bodega La Florida, some 3 years earlier. Amazingly, over the past 2-3 years, membership has swelled and the D.O. now represents 35 wineries in some capacity. These new names are largely artisan producers, making wine from grapes grown in their own proprietary vineyards.
While this in itself is interesting, this has happened at the same time as production has been under pressure, due to dry winters leading to fewer grapes. The combined effects on supply and demand has had major implications for the industry as a whole.
Lanzarote’s Vineyards – a Little Reminder and Background
There’s no better place to start than in the vineyards by understanding capacity and growth constraints. After all, more grapes mean more wine. If only it was that easy!
The Lanzarote wine regions of La Geria and Ye-Lajares are essentially fixed. It was only due to the volcanic eruptions that winemaking was made possible on the island. Our wine region cannot materially expand due to limitations of where the volcanic ash lies, which is a necessity. Of course, there are vineyards that can be refurbished (and there are on-going projects), but mostly these are less accessible and lower yielding. Even with these vineyards back on stream it would be difficult to increase island wide yield materially. It would also take 3-5 years for these vineyards to become productive.
For those unaware about Lanzarote viticulture, the island´s vineyards are seriously low-yielding, with just 3-500 vines per hectare in many parts of La Geria. At the very most you are likely to see 900. Bear in mind a typical continental vineyard has more like 4-7,000 vines in the same space!
This all means that, largely the growth in the number of commercial bodegas over the past 2-5 years, has been due to a shift in the movement of grapes, away from the sale from viticulturists to bodegas (more on this below), to a new and exciting model: new proprietary winemakers who care for their own fruit and produce their own wine.
Wine Tradition in Lanzarote
As a bit of background, Lanzarote has about 150,000 residents and 2,000 registered viticulturists; it really is in the lifeblood of the island. For generations this industry has been fueled by passion and tradition, equally or more so than for financial gain. Though, as with times, things do change. For years (and still is largely the case) these farmers will cultivate, make small quantities of family wine (or maybe none at all) and sell their surplus grapes to the islands’ larger wineries. These larger wineries are often buying from over 300 individual farmers each year. It is a big logistical challenge as they oversee the growth cycle and harvest, to ensure optimal quality of their wines.
Viticulturists - Old & New Generation
Sadly, the generation of viticulturists who passionately took this industry to where it is today, have reached ages where tradition and passion alone can no longer take the industry forward. In many cases, the younger generation who are inheriting these lands, no longer have the same motivation, based on solely passion and tradition. Things though, are now structurally changing for the future, at a time when volcanic wines have never been more talked about across the globe.
The New Generation
Fortunately, some of the younger generation share the same family passion and enthusiasm, but also see an opportunity to make a living from the vineyards and carry the industry to an exciting new place. In our view, this shift is happening very quickly. The evidence of this can be seen in many ways.
Driven by demand and supply, the price of grapes in the 2022 vintage rose by 50%, (as I type a further 10% in 2023) which is an incentive for the whole industry, whether you wish to sell your grapes or produce and sell wine from your own vineyards. Thankfully, the later option is being chosen more often and it is making Lanzarote wine an incredibly exciting place to be, with more styles and winemaking philosophies than ever before.
With this, it means the new generation is fully committed to their project, both to the land and production of their own wines. This is the way to extract maximum financial return for each grape, that they have worked so hard for 12 months to produce.
Wine prices have already begun to move significantly higher and in many cases, like for like wines are up 60% in the past 2 or 3 years, driven by quality, supply and demand. This of course is now giving financial incentive to stay or return to the industry. It is something that has needed to happen for some time in order to secure the future of Lanzarote wine.
An Early Blueprint
Bodega Vulcano have become one of Lanzarote’s leading wineries since their inception in 2009. Owner and winemaker Victor Diaz’s family have made wine for 5 generations, but in the late 2000’s, they took a decision: either to stop cultivating their land to sell grapes for little financial gain, or fully commit to a new beginning. Luckily for us they chose the latter, and are now one of the most stylish, boutique wineries on the Island, producing around 100,000 bottles per annum. Albeit on a smaller scale, many are now following this blueprint some 15 years later.
New Wineries & The Consequences For The Established
Today, the evolution of the wine industry and the increasing price of wine is creating opportunities for the younger generation to make a career choice. In doing so, the family businesses are changing, from selling grapes to producing wines. The potential of increased economic incentivisation is leading to a diversified range of styles and signature wines, which carry a heavier price tag, and for good reason. These new names are pushing boundaries and trying to differentiate themselves, whether by winemaking philosophy, marketing, or distribution channels.
This is also having an implication for the bigger wineries, as some of the farmers selling their grapes to them are now working to this business model, meaning less and less grapes are available. The “fight” for grapes has intensified recently, meaning renewed interest in buying old vineyards or refurbishing and replanting existing ones.
With less grapes, the larger wineries still have businesses to run and adapt to the changing climate. We are seeing changes at some of the largest wineries to extract value, push boundaries and offer new references and in doing so differentiate themselves more than ever. Two of the biggest wineries are also in the midst of huge multiyear investments to prepare their business for a new era.
I remember being in Tenerife as recently as 2020 and thinking that the style of wines and processes used were far more progressive than Lanzarote. In just a few years though, this gap has changed significantly, and much is down to the new wineries entering the market. Many of these new winemakers are professionally qualified or working with consultant enologists from across the Canary Islands.
Now, even the bigger wineries are making changes or increasing the number of references to keep their business at the cutting edge. El Grifo completed the first winter harvest in Europe in 2022 and are now using proprietary yeasts across their range of wines.
Pleasingly, there is also youth behind these wines at the larger vineyards. The winemakers at the largest wineries are educated professionally on the mainland, have grown up cultivating and making wine with their families in Lanzarote and now hold the key to the future. Many of them are less than 40 years old.
Not without its challenges, Lanzarote wine is an incredibly exciting place to be! In our view, there is a fantastic balance of youth and experience across the vineyards as we progress, to a new era for Lanzarote wine. It is no doubt buoyed by a general global interest for volcanic wine, together with a more gastronomic aware visitor to the Canary Islands than ever before. After all, these wines, well 90% of them at least, will never leave the Canaries.
Maybe after the substantial changes of the past 2-3 years, the industry needs to take a breather, adjust to the new pricing regime, and not to forget that quality is what got the island here in the first place.
And finally, climate change will of course be a concern and an unpredictable challenge and that's not just for Lanzarote.
We do hope you can enjoy Wine Shop Lanzarote from wherever you are in Europe, but of course, we hope that you will visit us and see for yourself the incredible and unique wine region of Lanzarote!
In the months ahead I intend to write a third and final part of this story, so do sign up to our newsletter if it is of interest. You can sign up here at the footer of the webpage.
For enquiries please contact Ollie here.
Written by Oliver Horton
1st August 2023
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