Thursday, February 2, 2017

Flexitanks- the least sexy (but most efficient) way to export wine

Over the last several classes we have been talking a lot about importing and exporting wine- the regulations, the marketing, and a little bit about logistics. But one area I think we have glossed over is exactly how the wine gets from point A to point B.
Wine can go by land, by air, and by sea. Most international wine journeys involve several stages. Different grape growers and wineries will choose to ship their wines in various ways, often with the tradeoff between cost and quality. During last week’s wine circle event, for example, Courtney Kingston mentioned that she always ensured that her wine was shipped in refrigerated containers from Chile, so none of the product would be ruined upon arrival in the Northern Hemisphere.
For independent producers, it is very common to go through the entire process of growing, making, and bottling the wine on-site before exporting the final product. While costly both economically and environmentally (cases of bottled wine are HEAVY, and expensive to ship), this is the best way to ensure the quality of the product—wine and packaging—as it leaves the cellar door.
For bulk wine, however, this is less of a concern. Bulk wine is much more commoditized—it is typically made from huge, high-yield vineyards, and each bottle (or box, or jug) of the end product is not expected to be all that unique or complex. Producers of bulk wine don’t need it to leave the winery bottled and labeled, and the fruit of many bulk wine growers may be sold to several different wine companies and destined for many different brands. Therefore, bottling bulk wine before international shipping- even into “shiners” (as mentioned in our case for today), is extremely inefficient. Not only do the shiners take up a lot of space—you have to pack them in cases so they don’t break!—they also add significant weight to the wine.
So is there a better way to ship bulk wine than in shiners? YES! The most efficient way to ship bulk wine is in a Flexitank. Flexitanks are giant, heavy-duty plastic bags (typically polyethylene) that fit into standard shipping containers, and can hold the volume of 32K bottles—about three times the volume held if the wine is in bottles and cases. The wine is then bottled in its country of destination, and shipped out to wholesalers and then consumers.
That’s like a giant bag of Franzia! Does the Flexitank alter the taste of the wine? No! Most commercial wines are not meant to be aged, and their quality actually begins to deteriorate the moment they are in bottles. Shipping in a Flexitank actually lengthens the shelf life of these wines, by allowing them to be bottled closer to their end destination. Being shipped in such a large volume also reduces the risk that the wine experiences significant temperature swings during the shipping process, protecting it from accelerated fermentation. Even if the containers aren’t exposed to extreme temperatures en route, they can sometimes wait on the hot tarmac for weeks upon arrival while waiting to be unloaded. And, like Franzia, the plastic does not impart any flavor onto the wine.
How much wine is shipped in bulk? Does this even matter? A lot! New Zealand Sauvignon Blanc and Italian Pinot Grigio are both widely shipped in bulk. According to UC Davis, in 2012, the % of exported wine shipped in bulk from the following countries is as follows: Argentina (45%), Australia (53%), Chile (37%), France (20%), Italy (31%), Spain (51%), US (43%). Shipping wine using Flexitanks vs. bottles minimizes the carbon footprint, which at this scale would be (and is) incredibly impactful.

Although, as the title says, this is by no means a “sexy” innovation—Flexitank shipping is becoming a source of significant savings in the bulk wine industry… and it continues to grow.  




My Dad :) 

5 comments:

  1. So interesting! Thanks, Amanda.

    At what quantity of production do flexitanks begin to make sense economically?

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  2. Wow, how cool! This also relates to the comment Randy mentioned in class that why do we transport and store wine in glass bottles? Is that the most efficient way to do it? Clearly not for large quantities of imports!

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  3. Super interesting! I'm also curious if this innovation has had a big impact on where bottling facilities are located (i.e., close to ports). Or is it still more efficient to use intermodal transportation to get the flexitanks to bottling facilities that are more centrally located (e.g, Ohio like in the WineDirect case)?

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  4. Just to add one more comment here, I found this really interesting. What struck me as well was the % of exported wine that is shipped from Spain at 51%. It seems like a lot for an "old world" producing country. Thanks a lot for sharing!

    P.S. Nice win at the wine circle blind tasting last night :)

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  5. Fully agree, Amanda! The other option I would love to see take off is shipping in kegs. But unfortunately, at least for the market in Singapore, most restaurants and wine bars are not ready to serve their wines this way, and they in turn blame their customers.

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