2 - Port Wine Law and Wine Business

Question 1

types of businesses engaged in production

Answer 1

• land ownership is very fragmented
• 21000 landowners 43% owning less 0.5ha and 91% less 5ha

-most sell the grapes to
(medium or large producers)
(cooperatives)

• cooperatives produce around 20% of the wine in the region
• cooperatives are permitted to sell wines under their own brands
• cooperatives sell their wines to producers
• brokers are part of the trading of the grapes or wines
• fewer producers with only 30-35 producing significant volumes
• 5 main groups of producers that make up 80% of sales by volume

Question 2

5 main groups of producers that make up 80% of sales by volume

Answer 2

-port Cruz largest producer
Gran Cruz

-symington family estates
Cockburn’s, Dow’s, Graham’s, Warre’s

-sogrape portugal largest wine producer
Sandman, offley, ferreira

-Fladgate
Taylor’s, fonseca, Croft, krohn

-sogevinus
Busmester, barros, Calem, kopke

Question 3

IVDP

Instituto dos vinhos do Porto e do Douro

Formed 2003

Succeeding the early IVP

Answer 3

• govern and represent the interests of the wine producers
• inter-professional body control and supervises the production and trade of wines unfortified and fortified
• responsibilities
• the beneficio (regulates the amount of Port that can be produced in any one year)
• holds the register of vineyards as well as companies involved in wine production and shipping
• controls the volume of ports that can be released onto the market in a year (this is set a maximum of 1/3 of a shippers total stocks)
• analyses and tastes the wines to ensure they meet the specifications of the different legally defined styles
• role to promotion of unfortified or fortified wines from the Douro Valley

Question 4

the beneficio

regulates the amount of Port must that can be produced in any one year

Answer 4

-amount of port must
(grape juice designated for port)

-vineyard parcel is classified in terms of the capacity of produce quality grapes for port
(considering factors such as location, altitude, aspect, soil, grape varieties planted)

• vineyard parcel receives a numerical value for each one of these factors, and the final total is used to give the parcel a letter
• A to I are awarded determines the amount of port wine that can be made from the parcel
• vineyard ratings F cannot make port wine, but can used to make unfortified wines or distilled spirit
• port must can be produced is different every year
• the growers, producers and the IVDP takes into consideration the market demand as well the current stocks available in the market to agree the quantity port must produce

-the aim is to keep grapes and wine prices stable through its influence on the balance of supply and demand

• each parcel owner is given a card or certificate for each parcel own
• is legal to trade the cards provided that the grapes from the parcel traded alongside but in reality the grapes will come from different parcels

-this set the grapes prices used for port €1.20-€1.40 the grapes out of the system €0.25-€0.40

Question 5

Port sales

Answer 5

• after 3 decades of growth at the end 20th century sales peaked at the millennium and have been steadily declining since
• 2017 production nearly 82 million L sales reached 75 million L
• but the average price increase due to the increasing sales of premium wines and age-indicated tawny ports

-IVDP separates ports in
-standard 45% sales
(ruby, tawny, white, rose)
-special categories 23% sales
(reserve ruby, tawny and white with an indication of age, colheita, garrafeira, vintage, single Quinta, crusted, LBV)

-85% port by volume is exported

• 1 France
• 2 Portugal