Chateau Ste. Michelle is the biggest winery in Washington state. When you count all the labels produced under its umbrella, U.S. Tobacco’s proudest non-cancer-producing property makes half the wine in Washington. But when you compare CSM to America’s really big wine operations, it’s a lightweight, and lined up against the world’s great wine conglomerates, among them Diageo, Southcorp, and Constellation, it barely registers on the charts.
As any corporate boss will tell you, being midsize has its advantages and its drawbacks. But in this era of incessant merger and consolidation, even to stay midsize, you have to grow. Ste. Michelle, jealously guarding its local rep as the big guy who plays nice with others, doesn’t exactly bugle the news when it bulks up, but the fact is that the company is putting on muscle. Last year, with virtually no fanfare, it took over Walla Walla’s Spring Valley Vineyard, a young but very prestigious operation crippled by the premature death of the visionary who put it on the map in a few short years. Go to the Spring Valley Web site, though, and try to find any evidence that it’s not the same old down-home family operation it ever was. Harder to overlook is CSM’s recent acquisition of Erath Vineyards, one of the first in Oregon to plant now-fashionable pinot noir (Sideways, you have a lot to answer for) and today the state’s largest producer of wines made from the delicate, quirky varietal.
Industry and consumer reaction to the news has been surprisingly positive. Erath hasn’t been at the top of its form for several years, so pinot fans hope Ste. Michelle’s famous devotion to quality and consistency will raise standards. As far as the competition goes, Erath isn’t big enough to threaten anyone, and pinot is such an insignificant crop in Washington that no growers or winemakers need to get defensive.
But the Erath buyout (vineyards, winery, back vintages, and all) is still worth noting. It’s one sign that Ste. Michelle is feeling the pressure to broaden its portfolio, to assert itself as not just a big local operation but a small but growing and competitive player on the national and international scene.
Further evidence along those lines was the distribution deal CSM worked out recently with il Marchese Antinori, one of Italy’s biggest prestige operators. The Marchese’s been flying in from time to time to check out the progress of his joint venture with CSM, the pseudo-SuperTuscan Col Solare. But distribution deals are a new business for the Woodinville-based Ste. Michelle, and we can be pretty sure we’ll be seeing more such deals in future. Like it or not, Washington wine is now in the big leagues, where they play rough.
