ADOPTION OF AN APPELLATION SYSTEM

Presenter: Ron Wiegand , from his SCAA conference presentation

Specialty coffee is where the wine industry was 10-15 years ago., that is to say that, much like wine, coffee consumption is suddenly declining on a per capita basis. In fact, coffee is down roughly half from where it was in the early 60s. We see the same trend in the wine industry, people are drinking less but drinking better.

Because of this trend, there is tremendous opportunity to make consumers aware of what specialty is. I am talking specifically about varietals. Specialty coffee consumption could be increased by double in the U.S., but it will bring some issues to the front that need to be dealt with. These issues are of direct importance to the adoption of an appellation system.

Issues in Specialty Coffee

If we do have an increase in the consumption of specialty coffee what happens to the supply. There is hardly enough to go around now, so we need to get producers to increase supply.

There is also deteriorating quality among some of the world’s top coffees. Kenya and Costa Rica specifically have been declining because of the introduction of new varietals in these areas which offer better disease resistance and higher yields, but fail to live up to older varietals in their flavor profiles.

Farmers are reluctant to reinvest in their farms because they have no incentive to do so, they are not getting higher prices for their beans. Fair market value for specialty coffee becomes an issue

The social issue of wages for labor in producing countries becomes an issue if consumer interest in and consumption of specialty coffee increases.

There is little name regulation in the industry which leads to confusion and worse, purposeful misinformation. The widespread use of names like Kona, Kona style, Java, and Mocha has to stop some day. Someone must put their foot down and state that coffees calling themselves Kona style must have at least 90% of Kona coffee in them, and only coffees from Yemen can go by the name Mocha.

These are issues an appellation system could help iron out of the system.

What Specialty Consumers Want

More information on specialty coffee. The more people pay the more questions they ask. Where does it come from? What is it supposed to taste like? How does this particular coffee differ from coffees grown in the same country or region?

An increasing emphasis on authenticity and truth in labeling. Consumers are not going to be happy to find that only 10% of the coffee in their Kona style blend is Kona.

A quality discussion that means something to them. The discussion about screen size confuses the consumer. They believe that the larger the bean the better the coffee. This kind of misinformation will backfire on the industry. Grading coffees by defect or screen size should be limited to the green trade and roasters. Selling should be done instead by quality and location. Authenticity and sense of place is what sells wine. Bean size doesn’t do it.

A clear idea of where the coffee originated. The use of port names as opposed to regional names just won’t work with specialty. Lots of coffee is shipped out of Santos, so consumers can get a broad variety of tastes and quality under the name Santos. Consumers would rather know the region than the port.

They want more consistency.

What is an appellation system?

There is an American and a European model for an appellation system, and in terms of style they are at opposite ends of the spectrum. The United States has a loosely restrictive system, while France has the most restrictive in the world. Other European countries follow the French system but with varying degrees of strictness.

Appellation systems are designed by a country’s government-it must come from within, the country of origin and each appellation system is a custom system for that country.

An appellation system is government stepping up to the plate and regulating how the regional names are used. It also defines the boundaries of any given region.

An Example

In the U.S. system, if a coffee is to be called Tarrazu it cannot be grown one inch past the line demarcating where Tarrazu is. In the highly restrictive French Model, not only must the coffee be grown and produced within the confines of that region, but it cannot contain any robusta, no cattui, no trees higher than ten feet, this kind of shade, that kind of irrigation, etc..

An appellation system is a government body broken into two sections: organizational / administrative, and enforcement. Not only are appellation polices inside the country enforced to make sure that production levels match the capability of that region, but enforcement also acts as an international liaison, promoting and presenting the system to the world market.

Remember, appellations come from governments within the region, so it is up to each country how restrictive the system would be.

The history of the U.S. Appellation system.

In wine, the difference in the US and European appellation system models is a function of time. In the U.S. the appellation system only started in 1978, up until then the wine industry used geographical political appellations, for example, county names to designate where a wine originated. Pressure from the European market changed this.

In the U.S. wine industry adherence to the appellation system is entirely voluntary. There are already existing AVAs or (approved viticulture areas) like Napa Valley which can be used in labeling. If you want to identify smaller areas, an application must be made to BATF-Bureau of Alcohol, Tobacco and Firearms. The grower must submit weather, soil samples, etc. and answer why this particular area should be considered an AVA. The area must be distinct from other areas but not necessarily better.

In its mandate the BATF states that it believes the establishment of AVAs is important because it helps consumers to identify the wines they purchase, and it allows wineries to specify more accurately the origin of the wines they sell to the public. However, the BATF does not want to give the impression that by establishing an AVA they are making a judgment on quality, or approving or endorsing the quality of wine from that area.

Any advantage gained by use of an appellation name can only come from consumer recognition of the area’s name, which comes about only through quality differentiation on the part of the producers.

It is important to keep this in mind that the US system does not make any quality distinctions, it only isolates a given area. It does not regulate the type of grapes, wines, or amount produced, or even where the vineyards can be planted.

The history of the European Appellation system.

France is the archetypal appellation system. France started is system in the early 1900s. In the late 1900s there were two major plagues which wiped out over half of the vineyards in France. Most producers went bankrupt. This created havoc in the wine industry throughout Europe. When vineyards were eventually replanted there was a tendency to put in higher yielding varietals. (Does this begin to sound familiar?) These new varieties had nothing to do with the regional wines traditionally produced in the growing areas. Regulators realized that the quality and characteristic flavor profiles of their country’s historical wines was being compromised. To avoid losing these national treasures, they came in and insisted on regulating the names of these growing regions, as well as details about how wines like Champagne could be produced. This is how the appellation system came into being.

The French system is a two tiered system: vin du table and regionally characteristic wines. Everyday jug wines are called vin du table. These wine labels can’t say anything about where they are produced. This is the equivalent of soluble coffee if you will.

Regionally characteristic wines can use specific names on their labels. The smaller the specified area the more stringent the regulations used in determining who can use that name.

The French AOC (appellation system governing body) regulates the following:

Essentially, the French system not only clarifies regions of production, but it promotes minimum quality standards as well.

How can appellation systems apply to coffee?.

The areas producing lower quality coffees could follow the U.S. system, clarifying growing regions to help identify coffees for the consumer. However, for the finest quality coffees, those that are recognized worldwide like Kona, there must be more regulation. If these coffees are not stringently regulated, it remains convenient for others to capitalize on the quality associated with the name and the appellation becomes degraded and diluted in the publicÕs mind.

Items that could be covered by the adoption of an appellation system, which we’ll call DCA (designated coffee appellation) include:

Pitfalls in ill-conceived appellation systems

It is important not to rush into anything. Adopting an appellation system too quickly has pitfalls. Following are a couple of examples.

In Germany in 1971 they passed sweeping wine law but it had one major loophole, they didn’t regulate yield per acre. Germans are incredible plant breeders, so they had the wine equivalent in Germany of Sumatra Lintong production doubling overnight and the quality of the wine went downhill.

Italy drafted its major appellation laws in 1963. Their mistake was they wrote into law practices which were taking place in their most famous producing areas, but unfortunately these areas had not been modernized. It made their wine making standards archaic, and didn’t allowing them to bring in other varietals, etc.

One of the key things any appellation system does is be flexible.

A model for the coffee industry-Chianti Classico 2000

There are seven districts in the Chianti Zone, the most famous of which is the Classico. There are 57,000 acres of vineyards, over 400 estates and over 1,000 bottlers. In this region, they have done something no other wine appellation has doneÑin the form of a research project called Chianti Classico 2000. This is a collaboration of the appellation board of Italy and a couple of nearby Universities as well as the growers and vintners association of Chianti Classico. It came about as a result of Chianti’s popularity during the 60s and 70s. A lot of money was poured into the region then, but without much thought. The quality of the wine declined, and they are finding that the area now needs to be replanted.

Beginning in 1988, about 50,000 acres will eventually be replanted. The regional appellation association became proactive in the replanting efforts. They approached the government and got a partial grant from Italy’s appellation board. They established 14 experimental plots with different micro-climates, and ten meteorological stations throughout the area which measure on a daily basis the following; temperature of the air, humidity, dew levels, rainfall and wind currents. They are looking at the influence of weather on each of the 14 areas. They are also looking at different things at each test site; varietal differences, root stock experiments, training methods, etc.

Everything about these grapes is being studied and the wines from them are micro-vinified. Each wine is then tasted and analyzed by a panel. The goal is to improve the quality of the wine they are famous for and discover which varietals thrive under which conditions.

The bottom line is that the Chianti Classico 2000 project is looking to the future. To compete they must improve the quality of their product ; they must integrate the most up-to-date information available throughout its zone; and it must produce more typified and distinct products than ever before which nobody else can duplicate. This kind of research can easily be translated into the coffee industry in the most famous and quality oriented regions, and it is a necessity if the industry is going to meet the demands of the future. Region of origin and authenticity is what will set apart coffees as unique and distinctive, and this is what will continue to bring the better money and attract the future consumer.

 


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