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The purpose of this paper is to empirically examine the macroeconomic determinants of Port wine exports, taking into account the diversity and various quality levels associated with this product.

Port wine is a fortified wine only produced in Portugal. In the period 2006-2014, an extended gravity model is applied to data on the exports of the top 20 importing countries, accounting for 94 per cent of total exports. The authors base their empirical strategy on the Hausman–Taylor estimator (1971), overcoming endogeneity and accounting for time invariant variables. They estimate the impact of several factors on the total trade of Port wine, namely: gross domestic product (GDP), GDP per capita, tariffs, exchange rates, distance from original supplier, mutual language familiarity, landlockedness, wine consumption per capita and presence of Portuguese emigrants, all measured in volume and value terms, and for each of the four categories (Standard, High Standard, Vintage and Aged).

The findings show that the quantity and value of total Port wine exports are positively determined by overall GDP per capita, the presence of a Portuguese emigrant community (which implies that to some degree a common language and culture are shared), while exports are negatively influenced by landlockedness. In contrast to the traditional gravity model, distance from the source of supply does not appear to be a significant determinant, a fact explained by the specific and singular nature of Port wine and by the long tradition of this product in international markets. In addition, the results revealed specific determinants for specific product categories – such as GDP for aged Port and wine consumption per capita for high standard, vintage and aged Port, suggesting that Portugal needs to increase its exports of high-quality Port wine to markets that exhibit a tendency towards increased wine consumption per capita and are coming to be considered large and fast-growing economies.

This paper extends the literature, by respecifying the typical gravity model for aggregate goods to permit the analysis of wine exports. There has been relatively little application of this model to assess the determinants of the wine trade, and when it has been used, generally it has been in studies focusing on aggregate wine trade between countries. This paper seeks to fill this gap by focusing on the determinants of exports of a specific wine – Port wine, which is an internationally recognised product, with a clear internal product differentiation according to distinct quality levels – and in this regard provides new insights into the international patterns of trade in wine.

Diversified trading networks have recently drawn a great deal of attention. In the process, the importance of diversity has perhaps been overemphasized. Using the trade in port wine from Portugal to Britain as an example, this essay attempts to show how a market once dominated by general, diversified traders was taken over by dedicated specialists whose success might almost be measured by the degree to which they rejected diversification to form a dedicated “commodity chain.” The essay suggests that this strategy was better able to handle matters of quality and the specialized knowledge that port wine required. The essay also highlights the question of power in such a chain. Endemic commodity-chain struggles are clearest in the vertical brand war that broke out in the nineteenth century, which, by concentrating power, marked the final stage in the transformation of the trade from network to vertical integration.

Despite the universal recognition of port as one of the most traditional and famous fortified wines in the world, there has been little investigation into this product, in either the field of marketing or strategic management. An empirical investigation into the marketing strategies of port wine companies is presented here. Qualitative data were obtained during early 1998 through internal sources and semi‐structured interviews conducted with the directors of port wine shippers and the chairmen of institutions which play a key role in the port wine industry. Four different types of companies were identified in the port wine industry: companies owned by multinationals (MOCs), British family‐owned companies (BOCs), Portuguese family‐owned companies (POCs) and independent wineries (IWs). This study identifies the key issues faced in relation to each of the components of a marketing strategy. It reveals the importance of key issues involved in the development of marketing strategies of port wine, and in particular, the extent of distribution network, packaging, product quality, price point, value for money, direct marketing and the organisation of special events. It also reveals that the port wine industry is controlled by long‐term orientated organisations (i.e. MOCs and BOCs). Companies that have difficulties in controlling their distribution network (i.e. BOCs and IWs) also have difficulty in establishing long‐term objectives. Generalisations to wine marketing must be made with caution since this investigation was built on a study of a specific wine industry which has particular characteristics.

The paper aims to develop an understanding of the port wine sector from a relational, holistic, and dynamic perspective.

The research adopted a qualitative methodological approach. Primary data were collected through semi‐structured interviews. The analysis focused on the relationships established among both economic and non‐economic actors.

The paper offers an overview of the port wine sector on the basis of the conceptual background of the IMP (Industrial Marketing and Purchasing) Group. The study suggests that the dynamics of the sector is not solely determined by economic and technological variables, but also by interests assuming both an economic, social and political nature.

Further research should develop and test the findings by using other cases and methodological approaches.

Managers must be aware that firms are embedded not only in economic systems but also in political and social networks whose dynamics cannot be neglected.

While most studies on the dynamics of economic systems have focused on the role played by technological factors, relatively few have addressed the importance of collective actions. In this line, the paper contributes for a better understanding of the role of collective actors created to defend the interests of their members. Moreover, since the port wine sector is not an idiosyncratic case because most of its features are also present in other wine regions, the conclusions of the paper are likely to be used for the understanding of other wine regions.

In a communication which appeared in The Times, and which Mr. Max Pemberton has also addressed to this Journal, Mr. Pemberton observes that during the Great War a Commercial Treaty was made between this country and its oldest ally, Portugal. One of the considerations for this Treaty was that Great Britain reserved to Portugal the sole right of use of the name “Port” to be applied to wines certified as such by the Portuguese Government. Before that Treaty there was no legal restriction of the use of the word “port,” which could be, and was, applied to cheap Spanish and even British wines—such as “Tarragona Port” and “British Port.” Unfortunately, in granting Portugal the exclusive right to the word “Port,” our Government made no stipulation as to the standard below which the Portuguese wines should not be certified as port, and, in effect, the Treaty bound the English law to follow the Portuguese law in this matter. Port is a strong wine made from vines grown on the banks of the Upper Douro, and “fortified” at the vintage by the addition of fine grape brandy. Its strength is a vital and distinctive characteristic, and at the time when the Treaty was made, and for very many years before that, the strength standard recognised by all reputable shippers was not under 35 per cent. of proof spirit. At the time of the Treaty, our wine duty was 2s. 6d. per dozen for wines up to 30 per cent., and 6s. per dozen for wines above that strength. so that all “recognised” ports then paid our higher rate of duty.—In 1920 our wine duties were doubled and all wines over 30 became chargeable at 12s. per dozen, instead of 6s. With a view to reducing costs some syndicates in Portugal then started shipping ports to this country at strengths below 30 per cent., thus saving 7s. a dozen to the buyers. But this saving was not necessarily passed to the consumer, and as, unfortunately, the law does not require a statement of the strength of port on the label, these low‐strength wines can be sold to the public at the same prices as the recognised high‐grade and high‐strength ports. At present, therefore, the public has no security as to strength, unless it insists on buying ports of the well‐known brands of reputable, houses, which carry a guarantee that they are of full strength, and these low‐strength wines sold as port are pouring into this country in an ever‐increasing volume, nearly three times as much having been shipped to Great Britain in the year 1924–5 as in 1921–22. If all these 2,228.842 gallons of low‐duty port imported into this country paid the higher rate of wine duty, the Revenue would have received £390,000 more from them than it actually did—in other words, the difference in the duty paid on these wines has resulted in a loss of that sum to the British revenue. Our Government could not have foreseen, when the treaty was made, how it would be evaded. From the revenue point of view, therefore, as well as that of the consumer, there is a clear case for regulating the strength at which wines may be described as “port.”—Port now plays so great a part in the wine dietary of this country that there should be an amendment of our law which would compel a statement on all port labels as to the strength of the wine—whether above or below the 30 per cent. duty line—in protection of the British consumer, who, in the meantime, can protect himself only on insisting on a disclosure as to whether his wine be full strength or otherwise. Indeed, some of the leading houses have found it necessary already to state on their labels and in their advertisements that their ports are of “full strength” as a safeguard to the buyer. Undoubtedly, some legal protection is required for the growing army of port consumers, in accordance with the precedent by which the law compels disclosure of strength in the case of whisky and other spirits below 35 degrees under proof. The public would then be protected against a form of the “confidence trick” and vendors of port could not complain if they were required to state the strength‐standard of their wine. Strong wines (over 30 degrees) from our Colonies were granted in the last Budget a preference of 8s. per dozen in duty, with a deliberate view to the development of Empire trade. Such is the magic of the word “port,” however, that so long as the wines are subject to the competition of low‐duty Portuguese wines at a cheap price to which the name “port” may be applied (Colonial wines are not permitted by law to use that name) the preference wines cannot be fully effective. If our Imperial wines containing over 30 per cent. of proof spirit cannot be described as port, it seems unfair that the name should be allowed to Portuguese wines containing less than 30 per cent. of proof spirit.

This study aims to further develop the CLC stage/path’s identification model that distinguishes between path’s emergence (emergence stage), path’s development (growth stage), path’s sustainment (maturity stage), path’s decline (decline stage) and path’s transformation (renewal stage), and by applying it, define the current stage/path of the Demarcated Douro Region (DDR) cluster. The Port wine industry, which is the dominant industry of the DDR cluster, is at the maturity/decline stage – is the same for the cluster itself?

It is a case study with a longitudinal perspective based on the analysis of the dynamics of the parameters of cluster evolution using available secondary sources (cluster identity/brand; number of firms; number of employees; network; innovation; policies and regulations; and external markets – exports), especially addressing the past decade, that represent the stage of maturity/decline of the cluster’s dominant Port wine industry.

The conclusion is that since the 1990s the Demarcated Douro Region has gone through a “path transformation” where during the following 20 years new “anchors” for the cluster were gradually introduced, such as Doc Douro Wines, new forms of consumption of Port wine, tourism and olive oil. Since 2010 the cluster has entered a growth stage/(new) path’s development, where these “anchors” are in steady growth. The Douro brand is becoming more internationally recognized and established, the number of firms and employees is increasing, the network is restructuring with the creation of cluster-specific official institutions, innovation is especially reflected with increasing heterogeneity through diversification of the clusters into new activities and regulations and policies are supportive for expansion – all these parameters are indicating the rise of the new cycle for the cluster. Thus, the DDR cluster represents an attractive business environment and requires attention from regional policymakers to support the cluster’s development. Especially institutions have been highlighted as internal factors driving clusters growth, European integration as an external factor and firms’ strategies of diversification and internationalization as an appropriate de-locking mechanism for new path’s development.

This research contributes to the CLC theory by further developing and applying a CLC stage/path identification model. It provides a better understanding of the dynamics of the DDR cluster that diverge from its dominant industry life cycle, which is relevant for regional policies and firms’ strategies. This study has its limitations. It provides an exploratory application of the theoretical framework proposed, and consequently, no general conclusions are possible yet. More empirical studies with different clusters in different stages are necessary to test the framework.

These findings are useful to policymakers when designing their policies for cluster development but also for clusters’ entities and actors when making their strategic decisions as it allows based on the verification of the established parameter of CLC to identify its current stage/path of development.

The paper presents a theoretically grounded model for CLC identification and for the first time to the best of the authors’ knowledge applies it to a cluster case – the DDR cluster. This case applies the proposed model and illustrates its usefulness. The model provides the tools for a better understanding of cluster dynamics.

The purpose of this paper is to offer an insight into the fundamental changes taking place in Port wine production value chains. Specifically, the authors examine two distinct production regimes: when Port is aged and sold in the Greater Oporto and, alternatively, when it is produced, aged and sold in Douro.

The authors apply a tri-regional input–output model (Douro, Greater Oporto and rest of the country) for Portugal’s economy. This framework comprises a significant level of detail, with 431 products and 136 industries, the corresponding supply and demand for the products, by industry (for intermediate consumption) and final demand.

This study shows that the two regimes generate noteworthy, but quite heterogeneous, regional impacts. In both cases, the distribution of value added generates international and interregional trade flows. Moreover, the study reveals a greater capacity to capture national value added by getting the supply chain more intensive in localised services and by using state-of-the-art production techniques.

Using detailed regional data, the authors use disaggregated information, both for industries as well for territories, overcoming a common limitation in similar works that are grounded in international databases. Additionally, the approach integrates the trade interactions among industries and regions, which proves essential to uncovering spillovers resulting from the (direct and indirect) use of inputs from other regions and other countries.

The purpose of this study is to investigate international trade determinants, paying special attention to variables related to climate change and non-tariff measures (NTMs), as they shape more and more world trade flows, with particular incidence on globalised goods, such as wine.

Based on panel data of Port wine exports to 60 countries, between 2006 and 2018, a gravity model has been estimated through Poisson pseudo-maximum likelihood. Explanatory variables include NTMs, mean temperature, temperature anomaly, gross domestic product (GDP), exchange rate, ad valorem equivalent tariffs and home bias.

The findings show that exports are inversely related to both mean temperature and temperature anomaly in importing countries. Regarding NTMs, it is found that only part of them are trade deterrent. Additionally, purchasing power in importing countries is one of the main determinants of Port wine exports.

The results show that, besides traditional economic variables, policymakers and wineries should include in their exports' decisions the impact of variables related to climate change and NTMs.

The novelty of this paper is to incorporate the impact of climatic variability of importing countries as a determinant of international trade of wine. Most former studies inspired of the gravity model consider explanatory variables such as GDP and exchange rate, and more recent ones started to consider NTMs too, however, this study may be the first paper to include the impact of climate change (quantified by mean temperature and temperature anomaly in importing countries) on exports.

The observations in an article upon British wines which appeared in the January issue of the JOURNAL have occasioned the publication in The Wine and Spirit Trade Review of some comments endorsing views which we set forth, and also the publication in the same periodical of a letter addressed to the BRITISH FOOD JOURNAL, from Mr. G. Gordon Watt, of Messrs. Lamb & Watt, Ltd., in which he protests against certain views which he attributes to us, but which, in fact, are nowhere to be found in the article in question. The policy of this JOURNAL for the last nearly fifty years has always been to encourage and assist the producer of good and genuine products, and our duty to the public and to the honest manufacturer is to call attention to practices which we consider are not in the best interests of either. We do not underrate the position which the British wine industry has won for itself; the fact that in pre‐war years some six million gallons of these wines were produced and sold, sufficiently attests their popularity and the need which the industry meets, and undoubtedly it has played an important part during the war years in filling the gap created by the almost total exclusion of the importation of foreign wines for the British market. British wines are perfectly good and genuine products and occupy a legitimate position in the beverages of the country provided that they conform to the descriptions under which they are sold. In this connection we adhere to the opinion which we have already expressed, that where wines bear a foreign appellation, such as “Port Type,” “Sherry Type” or “British Sherry,” the purchaser is entitled to expect that the fruit of the vine is an essential part of the raw material used in the production of the wine. It has been suggested that it would be useful to both makers and consumers if some standard could be established for British wines which would prevent the sale under that description of concoctions which have none of the attributes of wine. In the event of standards ultimately being established, we are of the opinion that for the purposes of preservation it is desirable that wines of the Port and Sherry types should contain 28/29 degrees of proof spirit.

The Department of Scientific and Industrial Research has released an account of the preparation of emergency rations in the form of dehydrated foodstuffs. These rations were designed and made when the result of a forced landing of an aircraft flying over polar regions may have to be faced. Having regard to the special circumstances for which the method described by the Department was designed it is perhaps not too much to say that it introduces as great a change in feeding the crews of airships as did Appert in feeding the crews of sailing ships a hundred and thirty‐five years ago. Appert's method did much to eliminate scurvy. This to prevent starvation and loss of life which the accounts of Polar expeditions have too often recorded. Dried fruits and dried vegetables have long been known and used. Milk powder and egg powder are now as well known. If these and tinned foods be regarded as ordinary rations they are too heavy and too bulky to be of use in an emergency such as may arise when a Polar flight ends in an unpremeditated grounding and the crew are left in a Polar desert to make the best they can of the conditions. It will be remembered that in May last the “Aries,” a British Lancaster airship, made a trip of some 17,000 miles. Much of this trip was in the Polar regions. The g eographical North Pole was visited and in the return journey the true position of the magnetic North Pole was ascertained in a 4,000 mile non‐stop return journey from White Horse, Yukon, to Shrewsbury. In view of possibilities an emergency ration had to be designed in which most of the food was in the form of hydrostatically compressed blocks of compounded and dehydrated foods. The compression reducing bulk; dehydration, weight; compounding ensuring variety. The rations so prepared had to be sufficient to feed nine men for twenty‐eight days. An account of the rations so prepared forms the subject of the report issued by the Department. These blocks consist of mixtures of dehydrated foods with added sweetening and flavouring materials where appropriate, so that each is a ready‐made meal requiring only the addition of water. They are fabricated into tablets of standard size (usually 2in. by 2in. by 0·9in.). They need only to be wrapped in high grade waxed films or papers and their standard size facilitates the assembly of mixed rations whilst very little space is wasted as compared for instance with circular cans. They are made by one of two processes—those containing dried foods of large particle size such as dehydrated meat or vegetables are made by compressing the mixture in a hydraulic press. The pressed block can be broken down easily in the hand. Where the particle size of the material is much finer, as with spray dried powders such as milk or egg, such compressed blocks would be very difficult to crumble, and furthermore lumps escaping crumbling would remain as unreconstituted lumps and mar the smoothness of the product. Thus they are prepared by casting the mixture hot into moulds with added molten fat. The block can be dissolved by boiling water. Many of the blocks containing milk powder may be eaten as sweets. Four kinds of menus from these blocks were prepared to relieve monotony of diet. Details of these are given in the report for four days. The total number of calories for each day ranges from 3,550 to 3,380. The weight of food per man in grammes from 715 to 704. Fat in grammes 213 to 177. Percentage of fat 30 to 25. The computed total nett weight was 393 lbs. Rations for two days can be packed in a standard four‐gallon can—gas packed if necessary—as a master container. Fourteen such cans would be necessary. These, together with immediate wrappings, would make a gross weight of 435 lbs. A most important consideration is weight. It is pointed out that the water extracted during the dehydration process would fill another seventeen cans! If light metal alloys instead of tin plate were used for the master cans a reduction of weight would be possible, but even a total weight of 435 lbs. is “very modest” compared with the weight of most emergency rations, even when the weight of master containers is excluded for the rations as drawn up provide for each man three normal meals per day. The Department refers to the theoretical aspect of the provision of a calorific level of 3,400 per day, with a total weight of 704 gms. per man. If the diet were made up of pure carbohydrate, pure fat and pure protein alone, then, using the factors 4·9 and 4 respectively as the number of calories derived from each gramme of food, a diet containing 25 per cent. fat would have an overall calorific value of 5·25 Cals/gm. a diet giving 3,400 calories, as in Day 3, would therefore weigh 647 gms. This is an absolute minimum below which it would be impossible to go. This figure takes no account of the residual water content of dehydrated foods of salt or minerals or roughage. The weight of 715 gms. achieved in practice includes, in addition to water and roughage, some 8 gms. of salt and 13 gms. of tea. It is therefore considered that, for a ration which gives three normal meals a day, it would be virtually impossible with the materials available at present to reduce the weight of the ration further. It may be added that a stove has been designed to burn motor spirit should it be possible to salvage any after a forced landing. It is considered that this type of food may be of great value for future polar expeditions. This is undoubtedly true whether aeroplanes be used as part of the equipment or not. It may be permissible to suggest that rations such as these would prove useful in land expeditions at a pinch. While in the case of a ship having to be abandoned in mid ocean the crew's chance of survival would obviously be bettered by having a supply of such concentrated rations in the ship's boats.