Wednesday, June 6, 2007

Ethanol demand will affect tequila supply

PHOTO BY WILLIAM M. DOWD
(Double-click to enlarge image.)

The blue haze is acre after acre of agave fields stretching for miles near Tequila town.


The tequila industry has made a tremendous comeback from an insect infestation that threatened the agave crop several years ago. Now, a shifting economy is presenting as great a threat.

Mexican farmers are burning fields of blue agave, the plant used to make tequila, and resowing the land with corn to take advantage of a sudden demand for corn for United States ethanol plants.

"Those growers are going after what pays best now," said Ismael Vicente Ramirez, head of agriculture at Mexico's Tequila Regulatory Council. Officials there estimate a 25-35% drop in agave growing over the next few years.

Agave plants take 8 to 10 years to mature to usable size, so even a sudden reversion to agave won't avoid a shortage in the near-term.

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Heaven Hill expands line

Heaven Hill Distilleries has added to its brand lineup, buying the Mohawk domestic distilled spirits portfolio from Boisset America, the U.S. branch of the French winemaker.

The company will acquire the Mohawk and Newport franchises, the Basilica Imported Liqueur line and Rosita Tequila. It already produces such brands as Evan Williams Kentucky Straight Bourbon Whiskey, Whaler's Rum and Burnett's gin and vodkas.

Neither company would comment on the purchase price.

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