Fizzy or still

Updated: Dec 31 2007, 07:56am hrs
ITALYS manufacturing clusters are well known: machine tools north of Milan, jewellery in Valenza Po, tiles in Sassuolo and many more. Less famous is the countrys sparkling-wine cluster, the official prosecco district established in 2003 around the towns of Conegliano and Valdobbiadene, north of Venice. Regional legislation recognising the cluster has brought public money to promote prosecco, a wine made mainly from the grape of the same name.

Not that prosecco needs much help. Sales of the best prosecco, labelled

Denominazione di Origine Controllata (DOC), have doubled in the past 15 years, to reach about 50 million bottles in 2007.

Growing sales of sparkling wine have bucked the trend in Europe, where wine consumption has fallen over recent decades, particularly in Italy. Global sales of champagne, at around 300 million bottles a year, are also increasing. But according to Giancarlo Vettorello, general manager of the consortium that makes sure that the clusters winemakers follow the rules, the two wines do not really compete in the Italian market. The difference lies in how they are made: proseccos bubbles come from a second fermentation under pressure in steel vats, which is less costly than the labour-intensive method used for champagne. Champagne is for special occasions, but no special reason is needed to open a bottle of prosecco, says Mr Vettorello.

But the two wines do compete in export markets, where the muscle of the consortium and the DOC cluster has helped the many small firmsthe cluster has 2,800 vineyard owners and 460 wineriesthat lack the resources to promote their product abroad. About one-third of prosecco DOC production is exported, mainly to Germany where it has long been popular. But that market is mature, so the winemakers are now expanding into other countries. Sales in Britain have increased five-fold since 2000, to reach 1.1 million bottles in 2006; sales in America have increased from 555,000 to 1.4 million bottles over the same periodfar faster than champagnes sales growth.

Are champagne-makers worried A telling sign would be if they started to buy prosecco-making wineries. So far the only traffic is in the other direction: Vinicola Serena, the winery owned by the family of Giorgio Serena, the chairman of the winemakers association in the prosecco region, bought a medium-sized champagne firm near Rheims two years agothe first Italian business to venture there. Could proseccos bubble be about to burst

The Economist Newspaper Limited 2007