for MTBoris Titov, right, and French wine expert Herve Jestin presenting possible logos for Abrau-Durso’s official sparkling wine for the 2014 Sochi Olympic Games.
Tsar’s Bubbly Tipple Enjoys Sparkling Revival
03 June 2008By Matt SiegelABRAU-DURSO, Krasnodar Region — Sitting lazily astride a moss-covered wall, pensioner Yury Ivanov, 70, drained the last of his champagne glass and cast his eyes across the lake at the revelers whose twilight forms he could barely perceive.
“What did these millionaires come here for,” he wondered aloud. “Do they want to take the lake back to Moscow with them too?”
In a way, Ivanov wasn’t too far off the mark.
If Boris Titov, the head of business lobby Delovaya Rossia, has his way, he will be taking the lifeblood of this tiny North Caucasus village back to Moscow with him. He’ll also be taking it to St. Petersburg and Southeast Asia and maybe, someday, even to Europe.
What Titov, who heads a group of investors that bought the fabled Abrau-Durso vineyard last year, wants to bring back in exchange are jobs, prestige and, most of all, an example for small- and medium-sized business owners across the country.
“It’s the normal-size plant which is the basis of the economy,” Titov said in fluent English during a recent tour of the winery organized by his investment group. “They can produce wine, auto parts or furniture, but they are the basis of the economy.”
Titov had flown nearly 400 VIP guests and journalists from Moscow to the Krasnodar region to show off his newly acquired factory, taste its wares and stroll its grounds.
What they saw was a beautifully rebuilt winery, a business player at the top of his game and a carnival of conspicuous consumption. But whether the event will prove to be an inspiration to small business owners is hard to say, mainly because there didn’t appear to be many on the high-powered guest list.
The Abrau-Durso vineyard dates back to 1870, when it was established on the orders of Tsar Alexander II, who wanted a domestic source of sparkling wine for his court. Foreign experts brought in the latest equipment, and the factory issued its first bottles a quarter-century later in 1896, receiving good marks at home and abroad.
The winery, although a respected sparkling wine producer during the Soviet period, suffered from neglect and languished, with nearly 80 percent of its underground tunnels sealed off and unused. Its small runs became highly prized among the nomenklatura but out of reach for the average Soviet citizen.
Today, things have changed. A bottle of standard Abrau-Durso can be bought for as little as 150 rubles ($6.50) in many shops, with a bottle of their top-of-the-line Imperial vintage going for 1,400 rubles ($60). What the Soviets promised with their “a bottle of champagne for every Soviet family” campaign in the 1950s, Titov has finally made good on.
Hugging the shores of an alpine lake beneath the lush emerald slopes of the North Caucasus, Abrau-Durso is one of those places that should really only exist in a fairy tale or a tourism brochure.
But most of the last 17 years have been far from a fairy tale for Abrau-Durso.
Following the collapse of the Soviet Union, the area was thrown into an economic tailspin. The languishing winery continued its steady slide into disrepair. Its manicured gardens grew thick with weeds and its residents suffered.
Despite its proximity to the one of the country’s main oil export hubs in Novorossiisk, Abrau-Durso has, up until recently, enjoyed little benefit from the soaring hydrocarbon-fueled economy. This is what Titov hopes to change.
Sparkling wine is big business in the country, driven by a growing middle class eager to show off its wealth, analysts said.
Of all the domestic sparkling wines, Abrau-Durso has one of the finest pedigrees and thus the greatest chance of seizing market share from the sickly sweet Sovietskoye Shampanskoye that dominates the field, experts said.
Unlike Sovietskoye, which is produced from imported “wine material,” Abrau-Durso’s sparkling wine is made from locally grown grapes.
Hoping to capitalize on that pedigree and following on the example set more than a century before him by Alexander II, Titov has brought in experts from Champagne, France, to outfit the factory with the latest equipment and production techniques.
Herve Jestin, a French wine expert with more than 30 years’ experience, was brought in last year to restore the faded glory of the factory, which hopes to increase production from 5.5 million bottles in 2005 to 13.3 million bottles in 2008.
Jestin supervised the implementation of so-called “classical” production methods at the factory. These techniques differ from those used by most Russian producers, who pump bubbles into their wine rather than wait for the lengthier processes used in Champagne.
He also seems to have been imported to provide confidence to investors. Everyone knows the French are fiercely particular about their wine, and Jestin’s seal of approval carries a lot of weight.
“Everything is particular here. The soil and beneath the earth here is very different. Russia has a viticulture capable of producing wines of great standing, but completely different. … They just must be recognized for their own distinct quality,” he said.
Titov’s plan is to conquer the domestic sparkling wine market before moving on to friendlier and less competitive markets in Southeast Asia and the former Soviet republics. After that he would like to see the wine compete in Europe with the world’s best, although he admits that goal is likely far off.
Industry watchers warn, however, that the well-connected Titov may be getting ahead of himself a little when he talks about expanding into the highly competitive European and Asian markets.
Charles Borden, wine expert and owner of Moscow expat magazine Passport, gave a one-word verdict when asked about the likelihood of Abrau-Durso competing abroad: “No.”
“The demand is large and growing so fast here that there’s no need for producers in Russia to … export much to make any kind of contribution to their bottom line,” he said.
If Titov intended his display as an example to small- and medium-size business owners, he had a peculiar way of doing so. The entertainment — including a tour of the vineyard’s catacombs, multi-course meals and a stage show replete with Roman columns, an orchestra, fire dancers and an oddly out-of-place dancing crab monster — was exciting and lavish, but hardly a lesson easily imitated by those without connections like Titov, who said he never could have purchased the factory without help from Krasnodar Governor Alexander Tkachyov.
For now, locals like Ivanov will have to wait and see whether Titov’s champagne dreams translate into a real economic resurgence for the area, or evaporate with the fizzy bubbles once the celebrities have gone and the media glare fades.