The Road To Quality Is Israel’s Route Out of The Wine Desert

Carmel Image 9Vineyards at Carmel Winery

by Andrew Chalk

I was interested when the Israel Wine Producers Association (IWPA) came to town recently to publicize new developments in Israeli wine. Although, Israeli wine has been around retail stores here since the 1980s, it has been characterized by products targeted at the niche market of observant jews seeking a kosher product. If you wanted good wine, you looked elsewhere.

Things are different this time around. Israeli produces are pitching their wines based on the quality of their product. Essentially saying that they are able to compete successfully in the U.S. market (their number one export market) against wines from anywhere in a given price category. The reasons for this change of focus are several fold. First, Israel has seen a boom in the number of wineries in the country (there were 70 in 2000, there are almost 300 now). Second, a rapidly developing economy means that Israel cannot expect to be the lowest-cost producer. Third, the domestic market is tiny (population 8m people) and they don’t drink much wine.  

The Wine Institute puts per capita consumption at less than a litre in 2011. That is one tenth U.S. consumption (and even less than Benin). If the industry hopes to thrive, it knows it has to export and if it wants to export it has to make good wine. To that end, all the best Israeli winemakers train at global centers of enology such as the University of California, Davis, the University of Bordeaux and CFPPA in Beaune, Burgundy. The agricultural sector, already highly automated and efficient, provides knowhow and tools to determine the best vineyard sites.

IMG_2390-Edit_HeatherMeyers.Psagot Vineyards.640x480Vines at Psagot Boutique Winery

The industry produces about 6 million cases of wine per year (to put that in perspective, the Kendall-Jackson wine group produces around the same amount). The average winery makes 20,000 cases a year, making it a decidedly artisanal venture. In practise, the median winery is even smaller, reflecting the skew towards 5 large wineries accounting for 75% of production. Given its scale, Israeli winemakers do not expect to conquer export markets, just to establish a foothold in the right niches.

Under Israel’s hot climate, grape growing is possible because of the presence of mountains that provide cool but sunny growing conditions. The desert climate means that the incidence of fungal and other diseases is low. The absence of any rain for nine months of the year means that irrigation (from wells) is de rigeur. It was paucity of water that led to the Israelis inventing modern drip irrigation in the 1950s. This form of irrigation is now ubiquitous not just for wine grapes, but other crops as well, worldwide. Soil types vary, but volcanic soil is common

Historically, grape choices were mainly varieties targeted at the domestic market for sweet wines. For export markets, growers have planted the international varieties. Notably, Chardonnay, Sauvignon Blanc, Riesling, Gewürtztraminer and Muscat Canelli for whites and Cabernet Sauvignon, Merlot, Cabernet Franc and Syrah for reds. Experiments with Pinot Noir have been disappointing.

The IWPA brought two impressive, but contrasting, wineries to a media event in Dallas. Carmel Winery is the largest winery in Israel, producing over a million cases per year. Ninety five percent of its output is sold domestically, and equates to a domestic market share over 50%, making it something of a super-Gallo in its home market. Until less than a year ago Carmel was a grape farmers cooperative. A buyout led to it becoming a shareholder-owned company and freedom for management to focus on exports as the company’s new direction. It is a winery with historic roots, having been founded by Baron Edmond de Rothschild, owner of Château Lafite in Bordeaux, in 1882.

Carmel Logo

Psagot Boutique Winery has its business scale written into its name. Yaakov and Naama Berg founded it in 2003, with an unrequiting focus on producing quality wine. They now make 17,000 cases/year. Over 90% of production is exported.

We tasted through a number of wines from each winery and I was impressed with the quality of the winemaking. Highlights were, in order of tasting:


2013 Carmel Winery Selected Sauvignon Blanc, Galilee. Approx. $10.

The attractiveness of this wine stems from the value proposition of its $10 retail price. Here is an inexpensive Sauvignon Blanc in a style less grassy and acidic than similarly-priced Sauvignon Blanc from new New Zealand. It also has a heavier mouth feel than the New Zealand examples and mineral backbone that reminds me of some Sauvignon Blanc from the cool Leyda Valley region of Chile. The whole is put together in what seems to be too sophisticated a fashion for wine at this price.


2012 Psagot Chardonnay, Judean Hills, Approx. $25.

A superbly crafted example of a New World style Chardonnay with ripe tropical fruit flavors (especially mango), French oak, lemon and lime all tightly concentrated and balanced. A ringer for a top-tier California Chardonnay. Good value.


2011 Carmel Winery White Riesling, Kayoumi Vineyard, Galilee. Approx. $26.

The big surprise of the tasting. Petrol aromas in the nose, plus Riesling fruit. Slate and ripe fruit in the mouth supported by a high acid level. The U.S. market is difficult for Riesling but this one might do well if marketed to upscale Asian restaurants. Good value.


2011 Psagot Cabernet Franc, Judean Hills, Approx. $30.

Pronounced green pepper in the nose with dark fruit and black pepper. In the mouth a chewy tannic backbone underpins blackcurrant fruit. Long finish. A good example of this difficult to sell grape. Would be a good choice for an enterprising steak house to add to its by-the-glass program as an experiment in crack-marketing to see how many customers then order a bottle with their meal. Good value.


2010 Carmel Winery “Carmel.Mediterranean”, Galilee. Approx. $65.

A blend of 28% Shiraz, 24% Carignan, 24% Petit Verdot, 18% PetiteSyrah, 3% Malbec and 3% Viognier. Carmel’s flagship wine this blend has an earthy, warm climate character.


2011 Psagot Cabernet Sauvignon, Single Vineyard, Jerusalem Hills, Approx. $33.

This 100% Cabernet Sauvignon varietal goes head-to-head with premium Napa Valley Cabernets both in style and price. Vibrant dark fruit, plush tannins and a long soothing finish. Ideal with steak or lamb.

IMG_20140530_130138Dorit ben-Simon, Export Manager of Carmel Winery and Yaakov Berg, CEO of Psagot Boutique Winery

Wine & Spirits Stores:
Spec’s in Dallas
Sam’s Club in Plano and Dallas
Sigel’s in Addison
Corner Wines in Plano
PK’s on Hillcrest in Dallas
DFW Restaurants:
Avanti Ristorante in Uptown
Shooters in Victory Park
BlueFire Grille at the Westin DFW Hotel
Morton’s the Steakhouse in Uptown
Oishii in Dallas
Wine & Spirits Stores:
Spec’s in Dallas
Sigel’s in Addison
Pogo’s Dallas on Inwood and Lovers Lane
Fresh by Brookshires in Tyler, Texas
PK’s Fine Wine & Spirits on Hillcrest in Dallas
DFW Restaurants:
Shooters in Victory Park
Ferrari’s Italian Villa in Addison



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