Thailand's "extreme winemakers" survive in niche market (Feature)

By Peter Janssen Jun 7, 2010, 4:10 GMT

Hua Hin, Thailand - Thailand, situated 7-20 degrees north of the equator, shouldn't be a wine-making country, according to viticulture textbooks.

With only 12 hours of sunshine and a hot climate, Thai vineyards will never produce the quantities of grapes their counterparts do in Australia, France and Italy, but this has not stopped a handful of entrepreneurs from trying, and their efforts are beginning to bear fruit.

In recent years, Thai wines - especially whites - have been racking up accolades at wine fests such as London's International Wine & Spirits Competition and Australia's International Wine Challenge, suggesting that they are doing something right.

Whether these wines offer something unique taste-wise to the expanding world of viticulture, remains debatable.

'All we know is that our brands are winning a lot of international awards, so it tastes like wine,' said Kathrin Puff, German viticulturist and head winemaker at Siam Winery, producer of the Monsoon Valley brand.

Monsoon Valley's Colombard vintage 2009 won a trophy at Hong Kong's International Wine & Spirits Competition, using grapes grown on its 240-hectare vineyard near Hua Hin, 130 kilometres south-west of Bangkok.

Situated just 40 kilometres outside Hua Hin beach resort, the vineyard has become a popular tourist attraction over the past two years, offering elephant rides through the grapes, a wine-tasting bar and a restaurant.

With 56,000 Thai and foreign visitors in 2009, and 60,000 expected this year, the vineyard's wine sales have doubled.

Previously, Siam Winery concentrated on exports, primarily to cities with plenty of Thai restaurants such as London, New York and Tokyo.

With the growing popularity of Hua Hin Valley as a tourist attraction, the winery is now more optimistic about the domestic market, despite Thailand's high excise taxes on local wines which make them as expensive as imported products.

'When you export there is no excise tax, so you can get a bottle of Thai wine in New York, Paris and London cheaper than in Bangkok,' said Siam Winery's business development director Kim Wachtveitl.

The business model that works best in Thailand, is to turn your vineyard and winery into a tourist attraction and live off the on-site sales.

This is how PB Valley, GranMonte Estate and Chateau des Brumes, three of Thailand's established wineries, have survived. All three are based in the elevated Khao Yai National Park in the north-east.

With its cooler climate and loamy soil, Khao Yai (Big Mountain) has proven suitable for growing Shiraz and Chenin Blanc grapes, the two most popular varieties in Thailand, usually grown from vines imported from Australia or France.

GranMonte, with its 16-hectare vineyard and a 1.25-million-dollar winery installed last year, is making wines from Shiraz, Syrah, Chenin Blanc, Verdelo, Viognier grapes and this year is to offer its first batches of Cabernet Sauvignon.

'In Thailand it's very difficult to get a good yield from Cabernet Sauvignon, but we succeeded because my daughter studied how to treat vines,' said Visooth Lohitnavy, managing director of GranMonte Company. Visooth's daughter Nikki studied viticulture at Australia's Waite University, making her one of Thailand's first local wine-making experts.

GranMonte sells about 60,000 bottles a year, mainly at its vineyard which also boasts a French restaurant and a seven-room guesthouse for those who don't want to drink and drive.

Visooth, who also president of the Thai Wine Association, acknowledges that low grape yields and high government taxes mean Thai wines are limited to a niche market.

'I don't think we can be a major force in the world wine industry,' Visooth said. 'We are a small producing country, but the main thing is we should have good-quality wine for local consumption and for foreigners who like to taste Thai wines.'

Thailand's largest wine producer, Siam Winery, produces about 250,000 bottles a year.

'It's still peanuts,' Siam Winery factory manager Songkiat Audsabumrungrat said. 'Even for our five-year plan I don't think we will be able to produce half a million bottles of Thai wine.'

That said, the tropical wineries could well prove pioneers in preserving the ancient art of viticulture on a warming planet.

'We are actually extreme winemakers here,' Puff said. 'We are the future consultants for all the other wine countries because there is desertification in Spain, they have drought in France and heatwaves in Italy. So we're pioneering new developments in grape-growing here.'