Popping prosecco's bubble: Europe's push to change Australia's wine production

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Australian farmers want to export more to Europe's half a billion people. But they risk losing the right to market their products as prosecco, feta and parmesan.

The landscape drops away like a cliff face.

Rocks and jagged edges make way for a sea of green leaves that cover mostly hidden rickety wooden vines that dissect the hills, almost as if in spite of the incline.

"For me it represents the tradition and also our dream," Elena Moschetta says.

She's standing at the window in her winery's tasting room, overlooking the vineyard her grandfather started in Italy's Treviso region decades ago.

It's grown vastly in the years since.

When her father took over, he expanded the plantings to grow more prosecco grapes. Now, the third generation to run the family business, Elena and brother Enrico Moschetta have added a winery to their vineyard.

"It was our dream to produce prosecco," she says.

Prosecco in this region represents more than just a bottle of sparkling wine. It's a product that dates back to 1382, with the first mention of wine production in the region recorded during the Roman Empire.

"Prosecco was born here," says William Spinazze, a third-generation vineyard owner.

"It's a historical wine that was made, always, here.

"It's very common on Sunday — after mass, after Papa — to stop in a bar and drink a prosecco before having lunch with the family.

"This way of living, you can't drink heavy wine, so this is why prosecco broke into our culture, because it was the perfect way to enjoy your life."

The threat other countries pose to Italian prosecco is laid bare in the approach its farmers and Government are demanding of the European Union as it pursues trade deals around the globe.

"Because it's so popular, it's easy to copy it [and] make it in different areas, [so] we need to protect it with all our forces," Spinazze says.

"We know that some countries are producing prosecco as well, but it was born here and it's the same as Champagne."

The Italians argue prosecco embodied an integral part of the country's cultural heritage and say it needs to be preserved and protected in the same way as ancient ruins.

Those efforts have taken a boost in recent days, with UNESCO recognising the prosecco vine-growing hills as a World Heritage Site.

europe MEDITERRANEAN S EA NORTH A T L ANTIC OCEAN NORWEGIAN S EA europe2 MEDITERRANEAN S EA NORTH A T L ANTIC OCEAN NORWEGIAN S EA greece italy labels C onegliano T r eviso A so l o T ries t e V a l dobbiadene labels2 Th r ace Macedonia P e l oponnese C en t r al G r eece Thessalia E pirus

"Prosecco is the name of a town, it's in the north-east of Italy," says Paolo De Castro, a man steeped in European agricultural politics.

A former Italian agriculture minister, he's now the vice-president of the European Parliament's agriculture and rural development committee.

"[Winemakers] are very much proud to use this name, so we very much would like to find a way to create a market for the real prosecco and to find a way to clarify to the Australian consumer when prosecco is made in a vineyard in Australia."

In its effort to protect its brand, Italy sought to restrict the use of the word "prosecco".

It changed the grape name from prosecco to glera in 2009 and then registered prosecco as a geographical indication (GI), in a bid to obtain the same level of protection that Champagne has.

Champagne is arguably the world's most famous GI.

The system allows farmers and producers to protect names that are based off a location, provided they can prove its significance. There are various forms of GI. Some restrict the sourcing of raw products to a specific region.

For others, the production must happen within a set location, which in cases like beers and some processed meats, the GI is protecting the skill of local butchers or master brewers, rather than the ingredients they use.

In cases like prosecco, both the raw material and the stages of production must occur within the set zone.

"It's a way in which a producer can escape the commodity trap," says Francis Fay, the man responsible for overseeing Europe's GI registers.

"There's a lot of talk about globalisation and the impacts, particularly on the rural economy, in Europe at the moment and this is an instrument … that will prevent that price-depressing effect of commodity markets, where the producer is always running just to keep still as the price declines over time."

Unapologetically seeking change in Australia

Irishman Phil Hogan is an imposing figure within the European Commission's hallways.

Broad-shouldered and bespectacled, the 59-year-old towers above most he encounters.

For the past five years he's been the commissioner in charge of agricultural and rural development policies, and is rumoured to be in contention to take on trade in the yet-to-be announced new-look commission following May's European elections.

"We see the geographical indicator system as rural intellectual property," he says.

"Depending on the culture and the area and tradition of where these products are produced, [it] gives a premium price and gives an added value for the producers of those products."

Mr Hogan has played a high-ranking role in trade negotiations with Australia since the talks officially began in 2018. His involvement would only further escalate should he become Europe's trade commissioner.

Australian Prime Minister Scott Morrison reportedly wants a deal reached this year, but it's likely to take much longer to finalise. Market access, for both parties, is already strong. The EU is the largest foreign investor in Australia and two-way trade is already worth more than $100 billion.

"I cannot imagine why a country would not agree to recognise those origin denominators," says Michele Geraci, Italy's undersecretary of state for economic development.

"It gives consumers the certainty that the product does indeed come from that place."

Though he expects Australia to give up the name, the Italian politician acknowledges the concern it could cause for prosecco producers on the other side of the planet, many of whom pride themselves on their Italian ancestry.

"I think in this case we will be looking at sunset clauses," Geraci says.

"There would be a transition period where the local producer would have to adapt or adjust because we don't want to go to another market to hurt anyone specifically."

Australia fighting EU prosecco push

Australia and the EU have had a wine agreement for more than two decades, which is why prosecco is likely to be one of the only points of contention for winemakers in a broader free trade deal being inked.

That agreement is what protects the term "Champagne" from being applied to Australian wines.

Italy's move to change the grape's name infuriated the Australian wine industry, which has accused the Europeans of a "devious" attempt to "claw back" the prosecco brand.

After changing the grape name to glera in 2009, the European Commission wanted to register Prosecco as a GI in Australia in 2013, but the bid failed after Australia argued it had adopted the name because it was a generic variety name like chardonnay.

Exports of Australian-produced prosecco jumped 400 per cent in recent years, with domestic sales up 50 per cent. The volume of grapes crushed in Australia has increased 300 per cent since 2015.

But all of that is at risk, Australian prosecco producers argue, if a trade deal with Europe allows for prosecco protection in Australia.

The Australian wine industry is warning it will suffer an economic hit, and claims it will jeopardise up to $200 million in wine sales within four years.

They're also keen to talk about the impact it would have on rural jobs, particularly in Victoria's King Valley, which accounts for half of the nation's prosecco production.

Europe says Australia didn't want to talk about prosecco in the lead-up to its federal election in May. Some suspect that's because the King Valley sits in the independent-held marginal electorate of Indi, which the Coalition had wanted to win.

Australia's Trade Minister Simon Birmingham insists it's too soon to predict Australian prosecco growers will have to give up the name.

"Yes, the European Union will ask for certain protections of geographical indications," he says.

"We won't be resolving any of those until the very end of the process once we have secured the best possible market-access conditions that we can.

"Even then, if we are to the point of contemplating any geographical indications to be protected as part of EU demands to get a deal overall, that will only be after we've consulted extensively with Australian industry and understood what the implications of any of those things would be."

Cheeses could also be caught up in the GI debate

Besides prosecco, sources the ABC has spoken with list seven cheeses as those most likely to cause concern within Australia, should Europe want them protected.

The list includes feta, parmesan, haloumi, brie, camembert, pecorino, edam and cheddar. The mere mention of the latter will infuriate European trade negotiators, with "cheddar" not a protected term in Europe.

The GI protection is on the full name West Country Farmhouse Cheddar, and if the negotiations with Australia are like those with New Zealand, the EU will seek protections for the full name, not "cheddar".

"I have been seeing in the Australian media some references to the fact that we wish to protect names such as chorizo, or ricotta, mozzarella, salami, chevre, names like that, which is wrong," Hogan says.

"These are terms that aren't even protected in Europe."

Australia also has concerns with protections for the term "prosciutto", but like with cheddar, the protections the EU has sought in New Zealand are for Prosciutto di Parma, Prosciutto di San Daniele and Prosciutto Toscana.

Sources expect Australian trade negotiators to accept EU protections for the full terms of Brie de Normandie, Edam Holland, Pecorino Romano and Camembert de Normandie.

The EU sent Australia a list of the products it wants GI protections for in a trade deal. But neither side is willing to publicly comment on the full list.

To stop a term getting protection, Europe will demand Australia prove it's a generic term like milk or butter. Hogan's expecting there will only be a "handful" of contentious GIs likely to cause a stir among negotiators — a sentiment Australian officials echo.

"There has to be evidence produced of the use of this particular name, over a long period of time in order to have it protected," Hogan says.

"I think from an Australian producer's point of view, they will have to produce this particular evidence in order that it doesn't conflict with our Italian friends."

Could Australia take inspiration from Spanish cava?

Few in Europe are willing to dub Australian prosecco producers victims in the trade negotiations. If anything, the farmers are conscious of the competition that's at risk.

But they're also quick to point to Spain, and a path many think Australian prosecco producers should take to rebrand their product.

"In Spain, traditionally any sparkling wine used to be called champagne," says Ignacio Sanchez Recarte, the head of Europe's peak wine representative body CEEV.

"Spanish sparkling wine producers had the opportunity to create an own image and they created the geographical indication domination for cava, which allowed them to have a specific image.

"Instead of being seen as producers who replicate a French product in Spain, they were able to transmit to the consumers … something which is their identity and they were able to create value for their own wines."

European officials argue that without GIs, small, mountainous villages would struggle to survive. They say restricting production to certain areas has kept jobs and people in towns where they otherwise might have left.

"Nobody will be investing in those areas," Sanchez Recarte says.

"They will be going to valleys, where it's easier and production for the wine [is cheaper], which means the abandonment of traditional areas in the wine sector and the population of the European vineyards."

Feta cheese facing an Australian rebrand

The mere suggestion of the term "Greek feta" is laughable for Nesseris Konstantinos.

"For us Greeks, it's a joke," he says.

Like Italians with prosecco, feta for Greeks is more than food.

"Our fathers, our grandfathers produced feta many, many years ago, in the most traditional way," Konstantinos says.

"For us, feta is more than just a simple cheese. It reflects a way of life, it reflects a quality way of life."

Konstantinos is the production manager for a major feta producer in the north-eastern Greek town of Ioannina.

Here, there's what feels like constant mist in the air that keeps the grass lush, offering a year-round supply of feed for sheep and goats. As these animals graze, they do so among a thousand species and subspecies of plants that are endemic to the region.

This underpins Greece's claim to feta, arguing its microclimate is unable to be replicated and for feta to be real, it must come from the milk produced from sheep and goats grazing on this land.

"The GI is for feta. There is no 'Greek feta'," says Stavros Arachovitis , who until last week was Greece's agriculture minister.

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"Feta is the GI and it's unique to Greece.

"It's vital for [farmers'] survival. In order for them to stay in a rural [community], they need to have a good income. In order for them to have a good income their products must be sold at good prices."

Getting that status within Europe hasn't been without controversy.

White, brined cheeses are common throughout Europe, but all EU member countries had to relinquish the use of the term feta in Greece's favour.

"Coming from Finland, we had to do the same," Copa Cogeca secretary-general Pekka Pesonen says.

"[We had to] eliminate feta denominations from our Finnish dairy sector.

"We had to do it … we had to accept it."

In making the case for why feta needs protection, Greeks are quick to cite references to Homer's Odyssey.

The story goes that Odysseus and his men enter the cave of Polyphemus, in which the author describes a cheese that many argue is feta.

Francis Fay laughs in his Brussels office at the mention of Homer and feta, but insists stories have nothing to do with GI registration.

"This is great stuff for marketing a product to have all these wonderful flowery references to characters in history who may or may not have existed," he says.

"However, we're quite boring because we don't accept any of that stuff.

"We require a fairly tight description of the product that a food technologist or an agronomist would write with scientific data and levels of different trace elements and details of how it's produced in a much more scientific and prosaic way.

"But let's not diminish it, because a GI is a product with a story that it owes its specificity, its qualities to, where it comes from and the people who made it."

The ramifications of feta getting European protections continue to linger throughout the EU.

In January this year, the European Commission threatened to take Denmark to the European Court of Justice for continuing to use the term "Danish feta".

If Australia agrees to honour the feta GI, the product sold as Danish feta in Australian supermarkets will also have to undergo a name change, according to Greek producer Nesseris Konstantinos.

He's pressuring EU officials to secure stronger protections in Australia than a recently agreed-to trade deal with Canada.

"I don't think the Canadian example is a very good example. It should be an improved one," Konstantinos says.

"According to the agreement the European Union has with the Canadian authorities, it allows products that have been produced already in Canada to continue to produce for a period of time.

"This period of time can be extended and this can go on and on.

"That doesn't give full protection to the product. What we would like to have with Australia is full protection of the feta brand."

Sitting above Brussels' bustling streets thousands of kilometres away, Commissioner Phil Hogan isn't having the Greek complaint.

"My friends, in relation to feta and Canada, had no protection until we got the agreement between the EU and Canada," he says.

"So we've gone from no protection to a lot more protection before the agreement with Canada."

But he's adamant that feta protections will be sought in the negotiations with Australia.

"Feta is very important to the Greek authorities," Hogan says.

"We need to recognise that feta and Greece is synonymous."

Feta producers' complaints about the Canadian deal echoes in the ears of Italian cheese producers in northern Italian town of Parma.

It's a region renowned for some of Italy's most famous exports — Parmigiano Reggiano and Prosciutto di Parma.

Both those products have GIs on them — but Parma cheesemakers argue their product should have protections for the English word "parmesan".

"In Italy and Europe, the word parmesan is the translation into English of the word Parmigiano Reggiano," says Nicola Bertinelli, the president of the Parmigiano Reggiano cheese consortium.

"Outside Europe, unfortunately it's not like that.

"If you show a consumer a piece of cheese baring the inscription 'parmesan', even under it there is the inscription 'made in Wisconsin', 67 per cent of US consumers replied that that cheese came from Italy.

"If you add an Italian flag or another Italian symbol on the label, 98 per cent of the respondents said that cheese came from Italy."

Europe hasn't sought protection for "parmesan" in its negotiations with New Zealand. It's unlikely to ask of it from Australia either.

The protections the EU will likely seek will be for the full name "Parmigiano Reggiano", a product worth $4 billion in sales annually.

"Parmigianino Reggiano has its characteristics that are determined by the land [the cattle graze on]," Bertinelli says.

"We can state that 'parmesan' is not a generic name for a cheese but it is clearly associated with a cheese coming from Italy.

"The starting point for a free trade agreement between Italy and Australia is that the Italian GIs cannot be used for generic names for product categories."

Prosciutto di Parma producers, meanwhile, are much happier with the Canadian deal and hope the same happens with Australia.

The farmer-owned consortium that oversees Prosciutto di Parma has long battled against international competitors that use that name rather than the generic term 'prosciutto'.

Until it bought the trademark for the United States, Italian producers were unable to call their product "Prosciutto di Parma" in the United States.

The same occurred in Canada, where the consortium was unable to convince the trademark owner in that country to relinquish its rights to the name.

That changed when the EU and Canada struck a trade deal.

That deal means Italian-made Prosciutto di Parma can now be sold in Canadian supermarkets alongside that country's so-called Prosciutto di Parma.

The Canadians will have to make it clear its Prosciutto di Parma isn't from Italy and will have to refrain from using the nation's iconic colours — red, green and white — and buildings like the Colosseum or Leaning Tower of Pisa in its branding and advertising material.

"They can use the name Parma on the label, which is not good, but in the case of Canada it was the best possible solution," the consortium's Paolo Tramelii says.

"We accept it and we are glad that at least there is an improvement of the conditions that there were in the past. We hope an agreement is found with other countries and Australia, even if we don't have a problem with Australia."

Negotiation in a world of trade wars

It's almost impossible to miss a mural that's painted from top to bottom on the side of a high-rise building opposite the European Commission's headquarters in Brussels.

"THE FUTURE IS EUROPE," it screams in three-dimensional block print.

It comes at one of Europe's most difficult times in recent decades.

Britain wants out and a rise of populists are threatening to change the direction 28-nation bloc is heading.

Those European battles sit within a geo-political environment of increasing threats of isolationism amid prolonged threats of trade wars between the world's economic powerhouses.

"This is potentially a perfect storm," says the Commission's John Clark.

Speaking with a thick British accent, the senior European trade official is all too aware of the complications of the job he has in front of him.

"We have to be very careful in negotiating trade deals that we don't have a negative impact on the sensitive sectors in Europe, which are responsible for employing a lot of people in the rural areas," he says.

"It makes a lot of sense for us both to diversify our export markets as much as we can, especially Australia, which risks being very dependent on China.

"There will be some gains from both sides of this agreement. We have an interest in Australia's sub-federal procurement markets and Australia has an interest in getting better access for its agricultural products into Europe, so there are some commercial benefits for each side as well."

Securing a trade deal with the EU doesn't bring with it the obvious rivers of gold that securing one with an emerging economic superpower might.

But in 2019, trade deals mean more than just the exchange of goods between nations.

"Symbolism is important in the face of US-China trade conflicts," Australian Trade Minister Simon Birmingham says.

"It's actually critical to send the message that countries stand for trade, but there's a lot of opening of trade that can occur between Australia and the EU."

It's a sentiment Europe is keen to send to the world, and which outgoing European Commission president Jean-Claude Juncker wants to reinforce.

"In the midst of international trade tensions, we are sending a strong signal that we stand for rules-based trade," he said last month when he announced a comprehensive trade agreement with the South American political and economic bloc Murcosur — a deal that had been 20 years in the making.

Trade deals, rather than wars, are clearly what farmers want.

"Increased volatility is usually paid by farmers because of their poor negotiating powers," Copa Cogecca's Pekka Pesonen says.

"We strongly believe in rules-based international trade and it is really heartbreaking to see some of the big players, globally, are looking for an alternative.

"Destabilising international trade environment is to the detriment of the global community and the farming community. Even in the case of short-term windfalls during a dispute, you can't build your future on that."

Protecting their brands for their children

The harvest is looming on those steep inclines of north-east Italy.

The new vine shoots that arrived after winter grew into buds and are now almost fully fledged glera grapes.

They'll be harvested and sent to wineries where the glera grapes will emerge as bottled prosecco.

If the Italians get their way, this will be the only region in the world that will happen.

"This is another dream to pass [it on]," Elena Moschetta says.

"For me to my daughters and for [my brother] to his son."

"It's very important," feta producer Nesseris Konstantinos echoes.

"It's like a legacy. We preserve it and deliver it to the next generation."

Credits

Photography: Brett Worthington, Arcangelo Piai, Beatrice Pilotto

Illustration and design: Emma Machan

Brett Worthington travelled to Europe as the recipient of the EU-Qantas Journalism Award

Topics: government-and-politics, trade, viticulture, agricultural-crops, dairy-production

First posted