Monday, October 11, 2010

The Evolving Structure of the Wine Industry in Germany – The Case of the Lake Constance Region

Picture: Lake Constance in the South of Germany, with Swiss Mountains

The Evolving Structure of the Wine Industry in Germany – The Case of the Lake Constance Region

I visited the Lake Constance region a few weeks ago – with the Weinfreundeskreis Hochheim – and had the opportunity to visit a number of rather diverse wine estates. All of the winemakers had interesting stories to tell about the history of their estate. If you put these stories together, a fascinating picture emerges of the structure of the wine industry in Germany and how it has evolved over the years.

The Church

For many centuries, there was only one dominant force in the wine industry at Lake Constance: The church.

To begin with, mighty Schloss Salem, with today 110 hectares of vineyards, was originally an abbey, founded by Cistercian monks in 1134 in the small village of Salmansweiler. The monks named the abbey Salem - the place of peace. Over the years, it became a gigantic monastery complex with large agricultural estates run by the monks. The Cistercian monks came from the Bourgogne and they brought the traditions of winemaking to Lake Constance.

Picture: Schloss Salem

The church lost the Salem Abbey in 1802, when under Napoleon’s secularization, Europe was reorganized. Abbey Salem passed into the hand of the ruler of Baden, the Margrave of Baden, and became Schloss Salem.

Similarly, the Staatsweingut Meersburg - today owned by the Government of Baden Wuerttemberg - was owned by the Prince-Bishop of Constance at that time. It also passed into the hands of the Margrave von Baden during Napoleon’s secularization in 1802.

Pictures: Schloss Meersburg and View of Lake Constance

A Prince-Bishop is a bishop who is a territorial Prince of the Church on account of one or more secular principalities, usually pre-existent titles of nobility held concurrently with their inherent clerical office. Thus the principality ruled politically by a prince-bishop could be wholly or largely overlap with his diocesan jurisdiction, but not necessarily.

The beautiful wine cellar of the Staatsweingut Meersburg was built in 1720, when the Prince-Bishop of Stauffenberg (1658-1740) owned the castle.

The House of Baden

Before the secularization of 1802, the House of Baden was completely absent from the Lake Constance area, when it came to winemaking. That changed radically in 1802 through the secularization. The church was expropriated and the Margrave of Baden became the owner of both the Salem and the Meersburg abbeys, including the vineyards.

The original base of the House of Baden is Schloss Staufenberg in the Ortenau, with 25 hectares of vineyard land. These were the only vineyards of the von Baden family until they received the Lake Constance vineyards as part of Napoleon’s secularization. The von Baden family gave the Federal State of Baden and the wine growing area Baden their names. They were the rulers for about 1000 years.

The Wine Cooperatives

In the late 1800s, wine cooperatives entered the picture. The Hagnau wine cooperative was the first one, founded on October 20, 1881; it is the oldest wine cooperative in Baden.

This was a revolutionary development. The smallholders emancipated themselves, teamed up and started their own wine business. It should not come as a surprise that In Hagnau, it was a pastor, who was the driving force behind it.

Before secularization, for about 110 years the winemakers of Hagnau were under the rule of the Benedictine Abbey of Weingarten. The current wine cellars of the Hagnauer Winzerverein dates from these days. These were not bad days for the Hagnauer winemakers. Under the monastery’s rule, the winemakers received as a reward for their work half the wine yield and a field on which they could grow potatoes and vegetables for self-catering.

Picture: Dr. Heinrich Hansjakob, Founder of the Winzerverein Hagnau

This changed dramatically after the secularization. The winemakers lost the field on which to grow food and had to bear all costs of wine production themselves, but were paid for their output. As the smallerholders were in a weak position , there was a lot of pressure on prices and revenues kept on falling. In view of the difficult situation of the smallholders, the pastor and civil rights activist of Hagnau, Dr. Heinrich Hansjakob, encouraged them to form a wine cooperative and market their wine themselves. On October 20, 1881, the first wine cooperative of Baden was founded in Hagnau at Lake Constance.

The Federal State of Baden

In the 1900, the Government of Baden entered the picture. In 1919, the constitution of the Weimar Republic, so named because its constitution was drafted in the small city where the poets Goethe and Schiller had lived, established a federal republic consisting of 19 states. Baden was one of the federal states, the successor of the Grand Duchy of Baden (Großherzogtum Baden).

Baden came into existence in the 12th century as the Margraviate of Baden. In 1803, Baden was raised to Electoral dignity within the Holy Roman Empire. Baden became the much-enlarged Grand Duchy of Baden through the dissolution of the Holy Roman Empire in 1806. The Grand Duchy of Baden remained a sovereign country until it joined the German Empire in 1871. After the revolution of 1918, Baden became part of the Weimar Republic as the Republic of Baden.

The Government of Baden, as the successor of the Grand Duchy of Baden, took over the Staatsweingut Meersburg in 1918. But it did not take over Schloss Salem, which became the private property of the Margrave of Baden.

The Federal State of Baden Wuerttemberg

In the 2000, the Government of Baden and Wuerttemberg entered the picture. In the Federal Republic of Germany of today, the states of Baden and Wuettemberg have been merged to form the State of Baden Wuerttemberg. In the early 2000, the Margrave of Baden sold Schloss Salem to the State of Baden Wuerttemberg. But he retained all vineyards. The cellars and other parts of the Schloss Salem he uses, are long-term leased from the State of Baden Wuerttemberg.

Private Sector Winemakers

Finally, the private sector. In Baden the wine industry is dominated by wine co-operatives; they account for 85% of the region's production. This explains the low export share. Private winemakers are the exception. But there are exceptions. One of these exceptions is the Aufricht Estate. They started out as a member of a wine cooperative and became independent about 20 years ago, after the brothers Robert and Manfred Aufricht had taken over from their parents. We visited the Aufricht Estate and reported about it here.

Picture: Christian G.E.Schiller with Manfred Aufricht

Another one is Weingut Krause in Meersburg, with 4 hectares of vineyard area. He founded his Weingut in 1994. Most of the wines are sold on the premise, in particular at the Tavern of Krauses which was established in 1840.

Picture: Christian G.E. Schiller with Peter Krause

The Situation Today

So, now the picture is as follows.

The Church is out of the picture; it has lost everything, at least in the Lake Constance region.

1. The Hagnauer Wine Cooperative

The Hagnauer Wine Cooperative and other wine cooperatives have become strong players in the market.

The Hagnau Wine Cooperative currently has over hundred members. The vineyard area is 140 hectares. The grape distribution is as follows: 40 % Müller-Thurgau, 40 % Spätburgunder, 8 % Ruländer/Grauburgunder, 3 % Weißburgunder, 2 % Bacchus, 2 % Kerner, 5 % other, including Regent. On average, the yield is 9000 liter per hectar. On 10% of the vineyard area, the yield limitation is much stricter, 4500 liter per hectar, for the production of premium wines.

The Hagnauer Winzerverein wine portfolio is broad, focusing on good quality day-to-day wines. The entry wine in the 0.75 liter bottle costs Euro 4.50. This is a tick higher than what you pay in the Pfalz or in Rheinhessen for comparable quality. However, most wines do not exceed Euro 10. One of those beyond Euro 10 is the 2007 Hagnauer Burgstall Spaetburgunder Rotwein Barrique trocken for Euro 14.90, the Haganuer Winzerverein’s best red wine.

Pictures: Christian G.E.Schiller in the Wine Cellar of the Hagnauer Winzerverein and Hagnauer Winzerverein Truck

2. The Markgraf von Baden

The Markgraf von Baden is still in the picture, but as a private person; in fact, Schloss Salem Estate is one of the largest private wine estates in Germany. He lost the Meersburg Estate 100 years ago and gave up Schloss Salem, but he retained the vineyards of Schloss Salem and is long-term leasing the facilities.

The vineyard area of Schloss Salem totals 110 hectares, in Bermatingen, Birnau and Schloss Kirchberg.Varieties planted here are mainly Müller-Thurgau and Pinot Noir (for Weißherbst/blanc de Noir). The wines are produced at Schloss Salem. Also, bottle-fermented sparkling wines, perlé wines and spirits are also produced. In addition, there are about 10 hectares of vineyard area along the Rhein river, close to the Swiss border.

3. The Government of Baden Wuerttemberg

The Government of the Federal State of Baden Wuerttemberg makes wine at Schloss Meersburg. The Staatsweingut is located just above the port of Meersburg on Lake Constance. The vineyard area totals 62 hectares with holdings in the following sites: Bengel, Chorherrnhalde, Lerchenberg, Jungfernstieg and Rieschen (Meersburg – monopole holding), Olgaberg – highest vineyard in Germany at 520 metres above sea level (Hohentwiel), as well as Ritterhalde (Gailingen). The area is planted with Pinot Noir, Pinot Blanc, Pinot Gris, Chardonnay, Riesling, Müller-Thurgau, Traminer and Regent.

4. Weingut Aufricht

And then, finally, we have the young entrepreneurial winemakers who have dared to be on their own. One of them is Weingut Aufricht. The vineyard area totals 24 hectares, with holdings in the Fohrenberg and Sängerhalde sites. The Aufricht brothers grow Pinot Noir, Lemberger, Pinot Madeleine and Regent, and Pinot Gris, Auxerrois,Pinot Blanc, Müller-Thurgau, Chardonnay, Riesling and Sauvignon Blanc. The Aufricht brothers were the first to plant Sauvignon Blanc again in the Lake Constance region. The top red wines are matured in barriques for several years. Bottle-fermented sparkling wines are also produced.

The wine list contains about 30 wines. Half of them are white wines, starting from Euro 7.40 and going up to Euro 17.40. The red wines start at Euro 7.90; most red wines do not go beyond Euro 10. One of the two exceptions is a 2007 Pinot Noir for Euro 30.50, which is the most expensive wine in the portfolio. Lake Constance wines are, in general, no bargain wines – but still very good deals by American standards.

5. Weingut Krause

Another private winemaker, I visited is Weingut Krause in Meersburg, with 4 hectares of vineyard area. He founded his Weingut in 1994. Most of the wines are sold on the premise, in particular at the Tavern of Krauses which was established in 1840.

The total vineyard area of the Lake Constance area is around 550 hectares.

Schloss Salem

Staatsweingut Meersburg

Winzerverein Hagnau

Weingut Aufricht

Weingut Krause

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