Firm Creation, Firm Evolution and Clusters in Chile’s Dynamic Wine Sector: Evidence from the Colchagua and Casablanca Regions

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buy grapes from other regions, where the terroir is better suited for different wines (such
as Casablanca) than those produced in Colchagua. This is the same for high quality wine
firm Montgras who want to decrease bought grapes from 45% to 20%, but want to keep
this 20% contract farming to buy grapes from other valleys (Hamilton, 2008). Other
companies, however, are increasing or planning to increase their integration upstream
into other valleys instead of just contracts in these valleys, such as Luis Felipe Edwards
(2008) and Casa Lapostolle.

In Casablanca evidence shows that vertical integration has not occurred to such an extent.
Contract farmers are still used for two reasons. The first to make up volumes of grapes
from farmers within Casablanca such as Vina Casablanca do. The second is to buy grapes
from other valleys to make better red wines, a tactic used by both Veramonte and
Casablanca winery. It will be interesting to see if in the future the wineries in Casablanca
follow the lead of Indomita winery and buy an estate elsewhere to source the red wine
grapes from.

Serrano (2008) claims that there has been a viticulturalists’ revolution in the last four
years as vineyard managers realised:

“In Chile we realised that it wasn’t just Chile and it wasn’t just Maipo or
Colchagua. Each had its little spots and the viticulturists realised it and that
planting there on that specific slope was not the same as over there. Also that
planting Cabernet over there was not the same as planting Syrah.” (pg 6)
This has lead to more and more science being used in the planting of vines in the
vineyard.

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