California wines find strong market in Japan

Arnold the Governator toured Japan earlier this month, selling all things California in a trade mission.

Several people on the trip report that he was able to connect with the Japanese people in a way that a Gray Davis or Pete Wilson never could. Once you’ve seen Conan the Barbarian, a run-of-the-mill politician pales by comparison.

Included in the entourage were representatives from several agricultural groups, from figs to tree fruit and table grapes.

The wine industry was well-represented as well, with the Wine Institute and Ironstone Vineyards in Murphys, traveling with the governor.

Wine in Japan?

It turns out that Japan is the largest wine market in Asia, and the third-largest export market for California wine, behind the United Kingdom and Canada.

More than 250 California wine brands are sold in Japan, and the wine store with the largest number of California wine products outside of California is in Tokyo.

That’s according to the Wine Institute, whose president, Bobby Koch, went along on the governor’s trip.

“Japan is a terrific market for California wine,” Koch said. “This year we expect sales to increase about 36 percent over last year,” he said.

California’s market share in Japan is growing as well, Koch said. That’s because the two countries with a bigger share of the Japanese market, France and Italy, are experiencing flat sales, according to Koch.

Joan Kautz-Meier, vice president of international operations for Ironstone Vineyards, said Japanese sales have been steadily growing.

Ironstone sells wine under the Angels Creek and Cinnamon Grove labels in Japan, as well as Ironstone, she said.

The Japanese are used to European wines, which have a somewhat different style than California wines, Kautz-Meier said. But Japanese consumers like the taste of California wines, she added.

Red wines are the most popular there, especially cabernet sauvignons, Kautz-Meier said, but Ironstone’s Obsession, a white dessert wine, does very well.

Koch said the rising sales in Japan can be linked to three factors: the weak dollar, an improving economy in Japan and a broader access to stores because of deregulation of the retail industry.

Trade barriers in Japan also have been lowered dramatically, Koch said. There’s still a 15 percent tariff, he said, but it affects all importers — giving California a level playing field.

But why should we care much about whether the Japanese drink California wine?

Because Japan has long been a symbol of the United States trade imbalance: all those cars and electronics we like to buy.

If the Japanese buy $100 million worth of California wine, it helps in a small way to alleviate that imbalance.

A sizable chunk of that $100 million comes back to the Northern San Joaquin Valley in California, to the wineries here and the grape growers. And those dollars echo into the local economy, as winery and vineyard workers buy groceries, cars and furniture.

Koch commented that the governor’s popularity in Japan and elsewhere in the world could raise consumers’ awareness of the state and its products.

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