Thailand's Château de Loei struggles against the odds

by Jerry Hopkins

Peter Burford, a young Australian winemaker, sounds like any enthusiastic employee when he talks about his latest achievement.

"Once the new, fruitier Chenin Blanc, which is totally different from the winery's earlier one, and the Syrah are in bottles, we're going to America," Burford says. "Château de Loei may not win top prizes right away, but we'll be noticed. I guarantee it."

However, when you learn that Château de Loei (pronounced loy) is the first winery in Thailand, Burford sounds more like a raving lunatic. A serious wine from Asia? Isn't that where most wine is made from rice? And the Japanese call sake a wine, though it's really just an interesting beer with a short shelf life?

True -- up to a point. The emergence of a burgeoning middle class in the region has created an increasing taste, and market, for wine. This new trend, coupled with high import tariffs, has sparked a small but impressive home grown industry that now has wineries sprouting up from Beijing to Bali to Bangkok. And Château de Loei, one of the industry's pioneers, looks like a possible winner.

The small winery takes its name from the cool, unspoiled northern province of Loei, which hugs the border of Laos. When Château de Loei was launched in 1991, it seemed little more than a plaything, a whim of its aging and wealthy owner, Dr. Chaijudh Karnasuta (pronounced chy-YOOT car-nah-SOO-tah), the chairman of Thailand's largest construction firm and co-owner of a dozen hotels throughout Thailand, including the legendary Oriental in Bangkok. Now in its sixth year of production, Château de Loei has survived climatic misfortune, calamity and mistakes and is successfully producing Chenin Blanc and Syrah.

In fact, Château de Loei's success has stimulated competition. The Boon Rawd Brewery Company, makers of the successful Singha beer, founded the Khao Yai winery in the foothills of Khao Yai National Park, 125 miles north of Bangkok. Also, Sanan Kachornprasart, a former government official and military officer, founded the Château de Shalawan, named after a folklore crocodile, in Phichit, about 200 miles north of Bangkok. Both projects broke ground in 1999.

The seeds of Thailand's wine industry were planted in the booming 1980s, when the king, His Majesty Bhumibol Adulyadej, suggested that his country support domestic viticulture, and he underwrote the first experiment with the purchase of more than a hundred varieties from Germany, Australia and the United States. Chaijudh (in Thailand, even dignitaries are identified by their first name) decided to commit some of the rolling acreage that he'd acquired over the years to winery development.

Chaijudh didn't foresee the $10 million needed to prepare the land for planting, import French vines, build access roads and dam a stream to create seven pools for irrigation, and then another $4 million to purchase winemaking equipment. To complicate things further, Thailand does not produce many of the basic materials needed for manufacturing wine. Yeast, nutrients, enzymes, filtering aids like diatomaceous earth, bentonite, wine hoses, pumps, barrels and corks -- all these must be imported.

Winemakers, too, must be imported. Peter Burford is Château de Loei's fifth winemaker since 1995, the year of the winery's first vintage. The first winemaker lasted only a month. The next had a wife who threatened to leave him, and the third had a wife who did, because of the winery's remote location, where there's little to do but look at the pleasing scenery. The fourth winemaker lasted four years, but left in 1999 after marrying a Laotian schoolteacher.

Money can buy machinery and manpower. It cannot, however, control the climate, which has been the winery's most intractable obstacle. Ironically, Thailand's weather conditions provide too much of a good thing: two crops of grapes every year.

The first crop, which produces the best grapes, is harvested in February and benefits from the sunny weather of the dry season, which begins in November. Then, in contrast to conventional winegrowing regions, where the vines fall dormant and are pruned after harvest, the vines in Thailand produce new leaves immediately after pruning and mature again in the same year. But these second crops emerge during the rainy season, when wet weather batters the blossoms and drenches the roots, resulting in straggly bunches, low yields, and too much dilution and not enough sugar in the surviving grapes.

Mold, another result of the monsoon season, damages or kills many plants, while the year-round growth itself strains vines and shortens their life expectancy.

"It's definitely a challenge to grow grapes here," Burford said. "I don't think I would've undertaken [creating the winery]."

After an interview with Chaijudh in Australia, Burford arrived in Thailand this past January without having previously visited the winery. With him he brought a bachelor's degree in applied science in winemaking from Roseworthy Agricultural College in Australia, and a decade of winemaking experience. He began with such jobs as tasting-room manager and cellar hand at D'Arenberg Wines in South Australia, then rose to assistant winemaker and later to winemaker at Alexander Valley Vineyards in California, and eventually became director of winemaking at Renwood Winery (formerly Santino Winery), also in California.

Burford, his cropped salt-and-pepper hair adding a few years to his actual age of 31, was wearing hiking shorts and boots, and a T-shirt advertising a beer from Laos when I joined him in the small winery office. He poured a glass of his predecessor's Chenin Blanc and followed it with a glass of his own first effort from a bottle without a label.

"The previous winemaker put it through a secondary fermentation that produced a dry wine, when the local market clearly preferred a sweeter drink," Burford said. "Thai food is spicy, and a fruitier wine goes with it. I've fermented [my Chenin Blanc] only once. The fruit flavors are still there -- the melon and pineapple that give the wine its character. You can taste the sugar. It's a total change from previous years."

Another of the winery's continuing problems is the short supply of Syrah. Of the original 200 acres planted, only 20 were in Syrah. In a local market that prefers red over white, Château de Loei, which harvested 180 tons of Chenin Blanc grapes and only 20 tons of Syrah in February, is now facing a challenge. First crop yields have increased for Syrah from 8,500 bottles in 1997 to 20,000 this year, with no acreage added, but the production of Chenin Blanc has nearly tripled, from 65,000 bottles to 175,000, leaving the same market imbalance.

Chaijudh is taking steps to rectify this imbalance. He has turned the day-to-day operation of the vineyard and its employees over to an outside contractor, offering bonuses for higher yields and higher sugar content. He has also prepared more land for new Syrah plants and has imported Syrah concentrate from Australia to be used in the winery's vinification tanks until the new vines are ready to produce, four or more years down the line.

Why bear such expense for a cause that seems doomed to be unprofitable, if not outright bankrupt? Burford surmises that Chaijudh, like so many wealthy winery owners abroad, enjoys the prestige associated with an epicurean, high-status project. But, Burford adds, "He also believes in the wine. So do I. The proof is in the glass."

Chaijudh is one of Thailand's most successful businessmen, and has been for over half a century. He is chairman of the Italian-Thai Development Group, a conglomerate he built. It is 100 percent Thai-owned, primarily by the Karnasuta family. The company's name has its origins in a partnership formed in 1958 between Dr. Chaijudh and Giorgio Berlingieri, an Italian engineer. When Berlingieri died in 1981, his family sold its stake in ITD to the Karnasuta family.

One of the group's first contracts was to salvage five ships that had sunk in the Gulf of Thailand during World War II. Half a century later, the company is Thailand's largest construction firm. It manufactures cement at a concrete prefabrication plant, operates a coal mine to keep the plant going, makes the rails for all of Thailand's trains, holds substantial interests in finance and real estate, and owns the ten-hotel Amari chain in addition to the Oriental and Royal Orchid Sheraton hotels in Bangkok. Further, the company is active overseas, where it is working on a new city in Saudi Arabia, a road in Laos and a dam in the Philippines.

Today, Chaijudh, 79 and ailing, spends most of his time in Loei, a gentleman farmer traveling to Bangkok for meetings only once a month in his own plane (there is a private airstrip on his property). His Australian winemaker, 15 winery supervisors and 100 or so field workers, mostly women, are among the approximately 1,000 Loei citizens on his payroll. He owns a resort there and farms flowers, potatoes, cucumbers, tomatoes, strawberries, litchi, bananas, macadamia nuts and other crops. Loei is his fiefdom, which he views from his mountaintop villa, one of his numerous homes.

By 1996, Chaijudh's efforts seemed to be paying off. When the heads of state from 15 European countries and 10 Asian nations met in Bangkok at the First Asia-Europe Meeting in 1996, they were served wines from Château de Loei's second vintage at a dinner at the Oriental. But two years later, the first shipment to Europe crystallized because of tartrate instability, the result of faulty vinification. That wine remains in a warehouse in the Netherlands. A small shipment of Château de Loei sold out in Japan, but no further efforts were taken to sell the product outside Thailand.

Until now. Perhaps by the end of this year, Burford says, when American diners choose one of the better Thai restaurants, they may be offered not only Singha beer, but Château de Loei, too. And maybe one day the wines will win those top prizes that Burford and Chaijudh have worked so hard to earn.

Jerry Hopkins is a freelance writer based in Bangkok and is the author of Exciting Thailand. like a raving lunatic. Serious wines from Asia? Isn't that where most wine is made from rice? And the Japanese call sake a wine, though it's really just an interesting beer with a short shelf-life.

True -- up to a point. The emergence of a burgeoning middle class in the region has created an increasing taste, and market, for wine. This new trend, coupled with high import tariffs, has sparked a small but impressive homegrown industry that now has wineries sprouting up from Beijing to Bali to Bangkok. And Château de Loei, one of the industry's pioneers, looks like a possible winner.

The small winery takes its name from the cool, unspoiled northern province of Loei, which hugs the border of Laos. When Château de Loei was launched in 1991, it seemed little more than a plaything, a whim of its aging and wealthy owner, Dr. Chaijudh Karnasuta (pronounced chy-YOOT kar-nah-SOO-tah), the chairman of Thailand's largest construction firm and co-owner of a dozen hotels throughout Thailand, including the legendary Oriental in Bangkok. Now in its sixth year of production, Château de Loei has survived climatic misfortunes and managerial mistakes and is successfully producing Chenin Blanc and Syrah.

In fact, Château de Loei's achievement has stimulated competition. The Boon Rawd Brewery Company, makers of the popular Singha beer, founded Pak Chong Winery, the producer of Khao Yai wine, 110 miles north of Bangkok in the foothills of Khao Yai National Park. Also, Sanan Kachornprasart, a former government official and military officer, founded Château de Shalawan, named after a folklore crocodile, in Phichit, about 200 miles north of Bangkok. Pak Chong broke ground in 1997, and Château de Shalawan in 1999.

The seeds of Thailand's wine industry were planted in the booming 1980s, when King Bhumibol Adulyadej suggested his country support domestic viticulture and proceeded to underwrite the first experiment with the purchase of more than a hundred grape varieties from Germany, Australia and the United States. Chaijudh (in Thailand, even dignitaries are identified by their first name) decided to commit some of the rolling acreage that he'd acquired over the years to winery development.

Chaijudh didn't foresee that $10 million would be needed to prepare the land for planting, import French vines, build access roads and dam a stream to create seven pools for irrigation, and that it would take another $4 million to purchase winemaking equipment. To complicate things further, Thailand does not produce many of the basic materials needed for manufacturing wine. Yeast, nutrients, enzymes, filtering aids like diatomaceous earth, bentonite, wine hoses, pumps, barrels, corks -- all these must be imported.

Winemakers, too, must be imported. Peter Burford is Château de Loei's fifth winemaker since 1995, the year of the winery's first vintage. The first winemaker lasted only a month. The next had a wife who threatened to leave him, and the third had a wife who did, because of the winery's remote location, where there's little to do but look at the pleasing scenery. The fourth winemaker lasted four years, but left in 1999 after marrying a Laotian schoolteacher.

Money can buy machinery and manpower. It cannot, however, control the climate, which has been Château de Loei's most intractable obstacle. Ironically, Thailand's weather conditions provide too much of a good thing: two crops of grapes every year.

The first crop, which produces the best grapes, is harvested in February and benefits from the sunny weather of the dry season, which begins in November. Then, in contrast to conventional winegrowing regions, where the vines fall dormant and are pruned after harvest, the vines in Thailand produce new leaves immediately after pruning and mature again in the same year. But these second crops emerge during the rainy season, when wet weather batters the blossoms and drenches the roots, resulting in straggly bunches and low yields, with too much dilution and not enough sugar in the surviving grapes.

Mold, another result of the monsoon season, damages or kills many plants, while the year-round growth itself strains vines and shortens their life expectancy.

"It's definitely a challenge to grow grapes here," Burford said. "I don't think I would've undertaken [creating the winery myself]."

After an interview with Chaijudh in Australia, Burford arrived in Thailand this past January without having previously visited the winery. He brought with him a bachelor's degree in applied science in winemaking from Roseworthy Agricultural College in Australia, and a decade of winemaking experience. He began with jobs such as tasting-room manager and cellar hand at d'Arenberg Wines in South Australia, rose to assistant winemaker and later to winemaker at Alexander Valley Vineyards in California, and eventually became director of winemaking at Renwood Winery (formerly Santino Winery), also in California.

Burford, his cropped salt-and-pepper hair making him look a few years older than his actual age of 31, was wearing hiking shorts and boots and a T-shirt advertising a beer from Laos when I joined him in the small winery office. He poured a glass of his predecessor's Chenin Blanc and followed it with a glass of his own first effort from a bottle without a label.

"The previous winemaker put it through a secondary fermentation that produced a dry wine, when the local market clearly preferred a sweeter drink," Burford said. "Thai food is spicy, and a fruitier wine goes with it. I've fermented [my Chenin Blanc] only once. The fruit flavors are still there -- the melon and pineapple that give the wine its character. You can taste the sugar. It's a total change from previous years."

Another of the winery's continuing problems is a short supply of Syrah. Of the original 200 acres planted, only 20 were to Syrah. In a local market that prefers reds to whites, Château de Loei, which harvested 180 tons of Chenin Blanc grapes and only 20 tons of Syrah in February, is now facing a challenge. First-crop yields have increased for Syrah from 8,500 bottles in 1997 to 20,000 this year, with no acreage added, but the production of Chenin Blanc has nearly tripled, from 65,000 bottles to 175,000, maintaining the market imbalance.

Chaijudh is taking steps to rectify this imbalance. He has turned the day-to-day management of the vineyard and its employees over to an outside contractor, offering bonuses for higher yields and higher sugar content. He has also prepared more land for new Syrah plantings and has imported Syrah concentrate from Australia to be used in the winery's vinification tanks until the new vines are ready to produce, four or more years down the line.

Why bear such expense for a venture that seems doomed to unprofitability, if not outright bankruptcy? Burford surmises that Chaijudh, like so many wealthy winery owners abroad, enjoys the prestige associated with an epicurean, high-status project. But, Burford adds, "He also believes in the wine. So do I. The proof is in the glass."

Chaijudh is one of Thailand's most successful businessmen, and has been for over half a century. He is chairman of the Italian-Thai Development Group, a conglomerate he built. It is 100 percent Thai-owned, primarily by the Karnasuta family. The company's name has its origin in a partnership formed in 1958 between Dr. Chaijudh and Giorgio Berlingieri, an Italian engineer. When Berlingieri died in 1981, his family sold its stake in ITD to the Karnasuta family.

One of the group's first contracts was to salvage five ships that had sunk in the Gulf of Thailand during World War II. Half a century later, the company is Thailand's largest construction firm. It manufactures cement at a concrete prefabrication plant, operates a coal mine to keep the plant going, makes the rails for all of Thailand's trains, holds substantial interests in finance and real estate, and owns the 10-hotel Amari chain in addition to the Oriental and Royal Orchid Sheraton hotels in Bangkok. Further, the company is active overseas, where it is working on urban projects in Saudi Arabia, a road in Laos and a dam in the Philippines.

Today, Chaijudh, 79 and ailing, spends most of his time in Loei as a gentleman farmer, traveling to Bangkok for meetings only once a month, in his own plane (there is a private airstrip on his property). His Australian winemaker, 15 winery supervisors and 100 or so field workers, mostly women, are among the approximately 1,000 Loei citizens on his payroll. He owns a resort there and farms flowers, potatoes, cucumbers, tomatoes, strawberries, litchi, bananas, macadamia nuts and other crops. Loei is his fiefdom, which he views from his mountaintop villa, one of his numerous homes.

By 1996, Chaijudh's efforts seemed to be paying off. When the heads of state from 15 European countries and 10 Asian nations met in Bangkok at the First Asia-Europe Meeting in 1996, they were served wines from Château de Loei's second vintage at a dinner at the Oriental. But two years later, the first shipment to Europe crystallized because of tartrate instability, the result of faulty vinification. That wine re-mains in a warehouse in the Netherlands. A small shipment of Château de Loei sold out in Japan, but no further efforts were taken to sell the product outside Thailand.

Until now. Perhaps by the end of this year, Burford says, when American diners choose one of the better Thai restaurants, they may be offered not only Singha beer, but Château de Loei wine, too. And maybe one day the wines will win those top prizes that Burford and Chaijudh have worked so hard to earn.

Jerry Hopkins is a freelance writer based in Bangkok and is the author of many books and articles, including the travel book Exciting Thailand.