Vol. 1 No. 4…a visit to Schram’s – berg…(updated 2/22)

A little play on words. As it was the writer’s intention to cover more obscure wine regions and their wineries, this seems to be a good time to do so. Since beginning this blog, Schram is the first winery I have interviewed. There will be more, interspersed with other columns. Hope you find it interesting.

Schram Vineyards was started in 2008, as a result of Ashley and Aaron Schram’s passion for wine.
Establishing and operating the vineyard was no easy task with both working full-time. As if that wasn’t enough they soon had a baby, and then a second (she quit her corporate job on that child’s second birthday), and became the full-time manager with the equally important additional task of being a full-time mom. It is their passion that brought me to the winery in 2013, and why they are included in this blog (book?).

It is great fun to own a vineyard and winery (more so if you are a millionaire or more likely a billionaire). Sexy, romantic, and you establish yourself as an esthetic. After all, you can hire people, most of them fairly inexpensively…with the exception of a winemaker. However, you get to take the bows. Still the Schram’s are having fun. TB could name a few gentlemen vintners but instead would rather focus on those who put ‘sweat equity’ as well as real money into their endeavor. The obvious places are California, Oregon, and Washington. Since wine is produced to some degree in all 50 states), and living in Minnesota I decided to look at wineries here, in Wisconsin, and also in New York. TB even had a bottle of wine once from New Mexico, La Bombe, the winemaker being a scientist at Los Alamos who made the wine in his garage. The label showed a mushroom cloud…and the wine was pretty good too!
I took note of the Schram name because of the similarity to Schramsburg ( founded by Jacob Schram in 1862), the California producer of sparkling wine. Although Schramsburg is made to closely match French Champagne, the French sued and now the appellation can only be used for those wines made in the Champagne region.  Considering some of the ‘plonk’ that was passed off with ‘champagne’ on the label, who can blame them? Schramsburg became world-famous when then-President Nixon decreed that all wine served at the White House would be American-produced (this did not stop him from having a bottle of Chateau Margaux on the floor beside him…what did you expect from the man? It’s good to be president!

The Minnesota Schram’s first harvest was in 2011 but they sold all the grapes to other local producers. Their wines are now produced with about one-third of the grapes from the ‘estate’; other Minnesota growers; and from Yakima, Washington.

They use screw cap bottles, which some of you may be surprised to learn, are as expensive as bottling with corks. The Kiwi’s and Aussie’s were the first to do this with Randall Grahm (Bonny Doon), being the first well-known producer to adopt it. Take the romance out of it, and screw caps are more reliable. Ah, but what about the aging, you say? Did you know that if you store the wine long enough the bottles will probably have to be re-corked (Mouton Rothschild does this for its wine for free when they come to the U.S.). There is also the possibility of a ‘corked’ bottle (not a pleasant taste), not to mention some people saying they don’t like a wine and declaring it corked. Either way it is expensive for the winery.

They were assisted in the beginning by enologist Nick Smith, who teaches Enology at the University of Minnesota, where many varietals have been improved or created. Aaron, who has been making wine since he turned 21, learned well and fine-tuned his winemaking skills.

The Schrams have ten acres of land suitable for vineyards, of which six are gently sloping, southerly facing, and have plans to plant the other four acres soon. Their sales (increasing them for a young winery is always difficult) gradually grew and last year expanded by 200%, quite a feat and made possible by adding beer last year!

Schram produces wine from eight different Minnesota varieties — Marquette, Frontenac Gris, Sabrevois, Petit Pearl, Prairie Star, Brianna.  In addition, they use Chardonnay, Pinot Gris, and Cabernet from Washington.  From these they produce seven wines including their signature wine Marquette also available as a Reserve wine that is barrel-aged for 14 months. In December, they released their first sparkling wine, moving them somewhat in the direction of the California Schramsburg.

All is going well with Schram’s new community room (tasting room), and as if that was not enough they added a brewery. That is not as far-fetched as it may sound because you use much of the same equipment that is idle after the harvest is completed. There are a few other wineries in the U.S. doing this but Schram may be the first to do so in Minnesota. The advantage is that if one person in a couple only likes to drink craft beers, and the other only wine, they can provide both and make the thought of a visit more attractive to them. As TB has found over the years, it is not a far stretch to transform a beer drinker to a wine drinker, especially when there are several wines, both red, white, and a sparkler, as well as eight craft beers on tap!

From Spring through Fall they have wine tasting and fun events, making use of their beautiful outdoor space. Beginning this Valentine’s Day, they are offering dancing lessons one Saturday night a month; Case Club activities, ‘Paint and Sip’ nights, and many other events. They also serve as a venue for parties, weddings, etc., but Ashley made it clear this will not be their focus, as it is at some wineries.

If you are in the Twin Cities region, TB highly recommends taking the drive out Hwy 5 to Waconia and visiting the Schrams as well as some of the other vintners in the area. You might be surprised and you won’t be disappointed.

TB

©Copyright 2015 TBOW, all rights reserved.

Vol. 1 No. 3 …French Laundry update; Wine ‘Investment’ Clubs

According to the Napa Valley Register and other sources, most of the wine stolen from the French Laundry on Christmas Day was recovered in…of all places…Greensboro, North Carolina? Don’t have the details on how, or why it was there, OR how they located it. Those of you who have had property stolen know the frustration of having the property held pending trial – which in this case may or may not occur since they have no suspects in custody, or even identified. So where is the wine now? In the ‘safest’ place the authorities could find: the French Laundry’s OWN wine cellar. Wait…wasn’t that where it was stolen from? Worse, they cannot sell it until the investigation is complete. (Why does the evidence have to be held when there are so many ways of authenticating evidence today…and it is not ‘unknown’ for evidence to disappear even while in police custody (aren’t you shocked?)

Unanswered:

First and foremost: was the wine damaged? How was it cared for after the theft and AFTER the police recovered it? Would you buy the wine if you were dining there? Not TB, no way! Keller most likely would have done better had he been able to collect the insurance and buy more wine like it!

Next item on the agenda: According to the January 23, 2015 issue of Financial Advisor magazine, “more than half a dozen firms peddling wine investments, in the U.K. alone went belly up last year. “Why have there been so many flops?” There are lots of reasons…the article cites one fund, The Wine Trust, in the U.S., where investors put their money for eight years, but here’s the rub (at least to TB): they have $15-20 million in assets. When something goes wrong what can they do? Sell? To whom?

Another fund, Belgium-based, had wine assets worth 102 million Euros ($115 million in today’s market – $125 million according to the article which illustrates yet another risk: currency – at the end of 2012, then someone questioned their valuation methods! Like a fire in a theater, investors headed for that small ‘doorway’, and the fund could not meet ‘net redemptions’ (a not uncommon problem of any mutual fund – stocks, bonds, options, etc.

Besides ‘questionable’ appraisal methods (remember they use last price at auction…and there could be just one fool…or there could be trading among several holders…it happens in small stocks…and especially penny stocks, so why not wine? This is not to imply that the fund managers are dishonest (talking about wine), but they wouldn’t know why the price was being bid up if the ‘group’ consisted of several high-profile members.

Why would they do that? Why would a known billionaire and expert on wine have created counterfeit bottles and attested to their authenticity? Why did Cruse, a famous French wine negociant (not to be confused with a California firm with the same name), would risk, and eventually destroy the firm’s long-established  reputation by bottling cheaper wine as Pouilly-Fuisse? They were eventually charged, convicted and heavily fined. There have been several scandals, the worst being when methanol was put in Italian wine, killing six and injuring at least 30. The point is that wine prices are especially susceptible to scandal. To TB it is like people who don’t trust the U.S. Dollar, so they are investing in Bitcoins!

Back to investment clubs and the FA article. They discuss a 2009 bottle of Chateau Smith Haut Lafitte which rose by 143 percent between June 2010 and December of the same year! Meanwhile, French first-growth wines rose by 345 percent between 2005 and 2011 before falling 41 percent through November 2014. Let TB clarify this for you: that 41% decline is off the 345% which would reduce the gain to 203% – which means you had better have gotten in very early! Conversely, to get back to the high would require a 70% increase (something even stock investors fail to understand!).

But the real catalyst for price escalation was the Chinese, who shifted their attention from first growth Bordeaux to premier cru Burgundy, causing a reversal of fortune. Worse yet, the Chinese government cracked down on bribes of public officials (TB is SHOCKED), thus slashing demand. Recall TB’s comments in the first blog, citing Red Obsession, which stated that all of the great wine would be bought by the Chinese? TB’s response was: the same was said in 1988 – the year before the Japanese economy imploded and hasn’t recovered since then. Even diamonds aren’t forever, right Mr. Bond?

So TB will close with the same advice that he began this blog with: drink what you like, and buy what you like…not what some industry-anointed expert says you should…you will be happier and you will have more money in your pocket.

Until next time: don’t ‘stay thirsty my friends’ – drink up! This ain’t no library! (said by the bartender at an enlisted men’s club when TB was in the Navy).

TB

©Copyright 2015 TBOW, all rights reserved.