US embassy cable - 04YEREVAN2319

UNCLAS SECTION 01 OF 03 YEREVAN 002319 
 
SIPDIS 
 
COMMERCE FOR 4201/ITA/IEP/OEERIS/BISNIS/EHOUSE 
EMBASSIES - PLEASE PASS FCS 
 
E.O. 12958: N/A 
TAGS: KTDB, BBSR, BEXP, BTIO, AM 
SUBJECT: (IMI) OVERVIEW OF ARMENIA'S WINE SECTOR 
 
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SUMMARY 
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1.  This cable provides a brief overview of Armenia's 
wine sector for those considering trade and investment 
opportunities in Armenia.  It also includes a list of 
key contacts.  For more information contact the BISNIS 
representative or the Economic and Commercial Officer 
at the U.S. Embassy in Yerevan.  End Summary. 
 
2.  In Armenia's growing wine industry local producers 
are searching for foreign partners to find new markets 
for their products.  Some of them need to upgrade their 
facilities and are planning to purchase modern bottling 
and packaging equipment.  Many of them need investments 
in working capital due to the seasonal nature of the 
industry.  U.S. exporters may find many marketing 
possibilities as the wine sectors expand. 
 
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WINE INDUSTRY OVERVIEW 
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3.  Armenia is one of the world's ancient grape growing 
and processing societies:  Armenian winemaking dates 
back at least 3,000 years.  Industrial winemaking began 
in Armenia during the 1870s.  During the Soviet period 
Armenia expanded and improved its wine production and 
Armenian wines won a number of grands prix and dozens 
of gold and silver medals in international wine tasting 
events.  But the collapse of the Soviet Union heralded 
a collapse in Armenia's wine industry.  There is less 
total area of vineyards under cultivation and less 
total wine production today than twenty years ago. 
After 1995, the state began privatizing Armenia's 
wineries; fourteen out of thirty wineries remain as 
joint stock companies.  Recently, winemakers have begun 
recovering vineyards and establishing new wineries. 
The traditional assortment of Armenian wines is 
returning to the market and new labels are being 
established.  According to local experts, wine making 
is now one of the most profitable branches of Armenia's 
economy with excellent potential for expansion. 
 
4.  Currently, according to different estimates there 
are 14,000 hectares of vineyards in Armenia. 
Approximately 30-40 percent of these are used to 
cultivate grapes reserved for wine making, including 
the following: 
 
WINE TYPE                         GRAPE TYPE 
 
Select white table wine:      Voskehat, Banants 
Ordinary white table wine:    Voskehat, Rkatseteli, 
                              Mskhali, Garan Dmak 
Table red wine:               Areni, Kakhet, Saperavi 
Ordinary red table wine:      Saperavi, Kakhet, 
                              Cabernet 
Select red table wine:        Muscat, Voskehat, 
                              Arevik, Kakhet, Areni 
Ordinary desert wine:         Muscat, Kakhet, Saperavi 
Fortified dessert wine:       Voskehat, Voskahet 
 
The main grape growing and winemaking areas in Armenia 
are the Ararat valley, including the provinces of 
Ararat (the towns of Artashat and Vedi) and Armavir 
(the towns of Echmiadzin and Armavir), the northeast 
region (Ijevan, Tavush province), Aragtsotn province 
(the town of Ashtarak and Byurakan village), Vayots 
Dzor province (villages of Areni, Getap, town of 
Yeghegnadzor,) and Syunik province (Meghri). 
 
5.  The largest grape growing and processing center in 
the country is the Vayots Dzor province.  The province 
is famous for its Black Areni variety, which makes red 
table and semi-dry wines.  As wine making has become 
one of Armenia's most profitable businesses, local 
farmers are steadily increasing cultivation of grapes 
in the province.  There are now several wineries in 
Vayots Dzor province.  In March 1999, the last state- 
owned winery was privatized.  A number of new wineries 
have since opened. 
 
6.  Areni Joint Stock Company is the first private 
winery in Vayots Dzor.  Established in 1994, it 
produces a wine from the special Areni grape variety. 
The winery has participated in a number of trade shows 
and exhibitions both in Armenia and abroad.  More 
recently established private wineries in Vayots Dzor 
include Ginetas, producing a dry red table and a semi- 
sweet, Van 777, Kimley's and Gatnatun.  Ginekar Company 
produces wine kept for aging to be sold outside of 
Armenia in luxury hotels. 
 
7.  Armenia's largest wine enterprise is Getap.  It is 
a part of the Ararat province-based company Vedi-Alko 
JSC, which is the leading producer of wine and vodka in 
Armenia.  The company was established in 1999 as a 
result of a merger of two large Armenian wineries Vedi 
and Getap, and the largest vodka producer Vedi llc. 
Currently, it produces more than 30 varieties of table 
and dessert wines, sparkling wines, and vodkas.  The 
company's Vernashen semi-sweet wine is one of the most 
popular brands in Armenia.  Vedi-Alko exports its 
products to Russia, Ukraine, France, the United States, 
United Kingdom, and Poland. 
 
8.  Established in 1976, the Ijevan Winery became an 
open joint stock company in 1995.  This winery has 
successfully converted a Soviet winery into an 
efficient modern shop.  The winery is equipped with 
modern grape processing and wine bottling lines 
imported from Germany.  It produces several types of 
wines, including dessert red, semi-dessert, white dry 
table, red dry table, and rose dry table. In 2003, the 
company's sales increased six-fold to 234,000 bottles 
from its 1999 level.  The company exports its products 
to Russia, Japan and the United States. 
 
9.  Established in 1877, the Yerevan Ararat Cognac-Wine- 
Vodka Factory is one of the oldest enterprises in 
Armenia.  Nationalized in 1921, the enterprise grew to 
become the Ararat trust, Armenia's central vintage 
wine, cognac and vodka production center, whose sales 
accounted for 25 percent of Soviet Armenia's state 
revenue.  Privatized in October 1996, the Yerevan 
Ararat Wine Factory recently became part of a large 
Armenian company Multi Group.  Currently, the company 
produces various vintage Armenian wines and aged 
Armenian cognacs.  The enterprise owns a rich stock of 
wines, wine materials, Armenian cognac and cognac 
spirits. 
 
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STATISTICAL INFORMATION 
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GRAPE PRODUCTION (tons) 
 
YEAR     VOLUME 
 
2000     115,800 
 
2001     116,500 
 
2002     104,000 
 
2003     81,600 
 
WINE PRODUCTION (thousand liters) 
 
YEAR    VOLUME 
 
2000    3,620 
 
2001    6,390 
 
2002    6,541 
 
2003    2,042 
 
SOURCE: Armenia's National Statistical Service 
 
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MAJOR WINE PRODUCERS 
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Areni jsc 
Contact:  Rafayel Simonyan, Director 
Areni village 
Vayots Dzor province 
Tel: (374-81) 22-222 
Fax: (374-1) 58-79-28 
 
Getnatun LLC 
Contact:  Nairi Baghdasaryan, President 
Yerevanyan Ave. 
Yeghegnadzor 
Vaots Dzor province 
Tel: (374-81) 25-565 
Fax: (374-1) 58-79-28 
Ginekar LLC 
Contact:  Yervand Sardaryan, Director 
Aghavnadzor village 
Vayots Dzor Province 
Tel: (374-81) 22-271 
Fax: (374-1) 58-79-28 
 
Ginetas 
Contact:  Vardan Khalatyan, Director 
39 Levonyan street 
Yeghegnadzor 
Vayots Dzor province 
Tel: (374-81) 20-160 
Fax: (374-1) 58-79-28 
 
Kimley 
Contact:  Mikayel Grigoryan 
Areni village 
Vayots Dzor province 
Tel: (374-81) 22-222 
Fax: (374-1) 58-79-28 
 
Van 777 
Contact:  Mihran Manaseryan, Director 
Taperakan village 
Ararat province 
Tel: (374-9) 42-13-07 
Fax: (374-1) 58-79-28 
 
Vedi-Alco 
Contact:  Manvel Ghazaryan, President 
Vedi village 
Ararat province 
Tel: (374-1) 28-80-20 
Fax: (374-1) 28-80-20 
E-mail: info@vedi-alco.am 
www.vedi-alco.com 
 
Ijevan Winery JSC 
Contact:  Avetis Galstyan, president 
9 Yerevanyan street 
Ijevan 
Tavush province 
Tel/fax: (374-1) 22-13-47 
Fax: (374-1) 26-81-71 
E-mail: iwf@netsys.am 
www.ijevanwine.com 
 
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KEY CONTACTS 
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U.S. Department of Agriculture's Marketing Assistance 
Project 
74 Teryan street, Yerevan, Armenia 
Tel: (374-1) 52-55-62 
Fax: (374-1) 58-79-28 
E-mail: map@usda.am 
Web site: www.usda.am 
 
Armenian Development Agency 
Contact: Vahagn Movsisyan, Executive Director 
17 Charents street 
Yerevan-25 
Tel: (374-1) 57-01-70 
Fax: (374-1) 54-22-72 
E-mail: info@ada.am 
 
GODFREY