For Lebanon's wineries, exports becoming a lifeline

BEIRUT, Lebanon, Feb. 1 (UPI) -- For Lebanon's wine industry, exports have become a means of survival amid the country's worst financial crisis and the ongoing COVID-19 pandemic.

The general recession, devaluation of the Lebanese pound, which has lost 95% of its value, hyperinflation and rising poverty have hampered wine imports, as well as local production and consumption.

Carlos Adem, who founded Chateau Fakra winery in 1985 and serves as president of the Syndicate of Producers of Alcohol, Liquor and Spirits in Lebanon, said the local consumption market has decreased by 30% to 35% and exports by 30% in 2020, compared to 2019.

Lebanon's wine exports dropped from 2.5 million liters to 2million liters during those two years and he expects "it will be lower" for 2021.

"Imports have decreased by 65%, as we used to import 1. 2 million liters. In 2020, we have imported 492,000 liters," Adem told UPI.

Like most countries around the world, Lebanon saw a drop in wine exports due to the pandemic, he said, which "had very bad impact on consumption with restaurants closed, no jobs and lots of other problems."

Daily hardships

The extra hardships Lebanese are facing and the collapse in their living standards are affecting local demand. With a daily struggle to find food and medicine, wine is not a priority.

Although Lebanese wine is recognized and praised worldwide, Lebanese winemakers need hard currency to import equipment, sulfur, yeast, bottles and even corks and labels to be able to maintain their business.

Adem said the quality of production in Lebanon "is excellent," and wine producers have diplomas from the best countries in the world, like France, Italy and Germany.

"But we still have to work on marketing," he said. "We could have done far better. We have the land to do it, the people interested to do it, and we have enough producers, but unfortunately, the export is not as big as it used to be."

Sabine Bustros, board member of the Chateau Kefraya wine producer, acknowledged that the prices of some imported raw materials have gone up, saying it was a normal outcome of the current situation.

"But we have made every effort to face the challenges like every other business in Lebanon," Bustros told UPI, with a main concern not to let go any of their workers.

With a production varying between 1.4 million and 1.6 million bottles a year; 50% of which is exported to some 40 countries, Chateau Kefraya has been consistently awarded high scores on Robert Parker's rating scale, according to Bustros.

Today, they plan to expand their exports and reach more countries.

"When I see a Kefraya bottle wine in France or anywhere else in the world, one feeling comes to my mind: pride. And I am able to trace back in my mind the story of each bottle. I see it from harvest to the shelf," she said.

She explained that Lebanon has the unique advantage of many microclimates, which allows a wide variety of wine production in different regions across the country. Most wineries have originally been located in the eastern Bekaa Valley and the Chouf region, where a natural water table and clay-calcareous soils offer appropriate climates for wine production.

Wine-making tradition

Back at home, not many are able to buy locally made wine any more, and even those who can still afford it have become much more price conscious, given the increase in the exchange rate of the U.S. dollar and the fact that imported wine has become more expensive.

Chateau Rayak, a small family-run winery in the eastern Bekaa valley, reflects a passion that runs for generations.

Elias Boutros Maalouf, whose family fled the country during the 1975-90 civil war to Ecuador where he was born, took the challenge of reviving their old winery and resumed wine-making in 1997 under the guidance of his then 92-year-old grandfather.

But making wine is not easy, and it took Maalouf years to reach "a good wine." From 70 bottles he first produced with his grandfather, he grew to make 7,000 bottles a year, sold only in his own winery.

"We are trying to preserve the tradition... Chateau Rayak is the smallest winery in Lebanon, but we are very happy that we are making wine and selling it ourselves," Maalouf told UPI.

Despite the 2019 popular protests, tourists were still flocking for wine-tasting at Chateau Rayak, coming from countries that "faced similar financial crises and knew that Lebanon became [a] cheap [destination] like Greece and Cyprus and also from other European countries," he said.

But that changed with COVID-19 restrictions and last summer's severe fuel and electricity crisis, which has forced him to stop production for the first time since he restarted the business.

"Our winery is primitive, we don't have the equipment that automatically adjusts the temperature... We need to do that manually, so we sleep near our barrels," he said. "We are doing that from all our heart."

However, what Maalouf needs is to increase his own production so he can start exporting his products.

Help from USAID

The U.S. Agency for International Development has stepped in to help 15 wineries to export their products, especially to the United States, targeting Texas first.

Rana Helou, a USAID project management specialist, said the agency, in coordination with the "Made in Lebanon" company, is assisting this first group of wineries by providing training on meeting U.S. international standards and by identifying markets to them.

"The 15 wineries already took their certificates, and today they are able to send their products to the U.S.," Helou told UPI. "So the next step is to be able to comply with European standards and send their products to Europe."

With a total of $475,000 grants in kind for the first year, she said the increase in export sales was expected to total $5.3 million.

Neither Adem, who is a partner in wineries in France and Argentina, nor Bustros or Maalouf are willing to leave their vineyards, wineries or Lebanon despite the current deteriorating conditions.

For Bustros, it is about continuing the legacy of her late father, Michel Bustros, who founded Chateau Kefraya in 1979, and all the vines he had planted and "left behind."

For his part, Maalouf said: "If I have to leave Lebanon, I don't think I will live long."