Blog: Olly WehringTwo into one does go in Chile

Olly Wehring | 5 January 2007

It’s an interesting start to 2007 for the Chilean wine industry, with the news that the country’s two wine associations are to merge. The Asociación de Viñas de Chile and Chilevid will formally join forces in March to form a new body, Vinos de Chile, or Wines of Chile.

A single promotional association makes sense - united we stand, divided we fall, and all that.

The motivation behind the merger is more confusing. According to just-drinks’ sources the associations decided to work together after it became clear Chilevid (which traditionally handles the interests of the smaller wineries) was having more success lobbying the Chilean government on behalf of its members than Viñas de Chile, which looks after the larger rivals.

Apparently, the Chilean government has been more interested in developing and helping the smaller vineyards in Chile and, as a consequence, Viñas de Chile was losing power in its relations with the Government.

“Smaller vineyards use a greater percentage of labour and also have more potential to grow. If the Government wants to increase the amount of wine we export, it has to help smaller wineries. Sales from bigger wine producers do not change as much,” our source said.

What is interesting about this is that it flies in the face of the perceived wisdom that it’s the larger companies that should lead the export charge, and in doing so open doors for smaller compatriots.

Of course the cynic may point to our source’s first point about percentage of labour, but if the new Wines of Chile can push the boutique wineries on the export market it could effectively create a halo effect for the cheaper mass brands below it. Any new strategy will be keenly observed in this tough global market.


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