Brunello wine makers say U.S. sales power ahead

A tourist passes a glass of Brunello di Montalcino wine placed on a table in the Tuscan town of Montalcino in central Italy, September 22, 2004.

MONTALCINO, Italy (Reuters Life!) - Sales of top Italian wine Brunello di Montalcino to the U.S. market have powered ahead despite an ongoing investigation into alleged fraud by some producers, winemakers told Reuters this month.

The United States, one of the world's biggest wine markets, scrapped threats to bar imports of Brunello after Italy pledged that a government agency would guarantee authenticity of the premium red wine.

"U.S. sales have not suffered any slowdown. They have been gathering speed since July," said Patrizio Cencioni, chairman of the Consortium of Brunello di Montalcino who was elected after news of the investigation broke out in April.

Brunello made international headlines after Italian magazine L'Espresso reported that authorities seized hundreds of thousand bottles of Brunello on suspicion that some top producers used grapes other than the required Sangiovese to make the wine.

Brunello, a full-bodied wine grown on the hills around the town of Montalcino in Tuscany since the end of 19th century, boasts annual sales of about 120 million euros ($182 million). The U.S market absorbs a quarter of the 6.5 million bottle annual output.

Cencioni said the investigation was still ongoing, but some impounded bottles have been released.

"There has been a lot of noise about Brunello... But all is yet to be demonstrated," Cencioni told Reuters at the Consortium headquarters in medieval Montalcino. The Consortium represents all 250 Brunello producers.

The producers have denied any wrongdoing, saying they used only Sangiovese grapes.

"For now the situation is stable. There is no negative news," said Cencioni.

Brunello sales -- at an average retail price of about 30 euros per bottle -- jumped to over 4.9 million bottles at the end of June, a 47 percent rise from a year ago period, Consortium data showed.

But when the news of the seized wine broke out, Brunello producers scrambled to reassure their customers, said producer Paola Gloder, who is not under investigation. She sells about 20 percent of her 120,000 bottle annual output to America.

"There was a lack of information. People did not understand what was going on here. We had to urgently explain the situation to our clients," said U.S.-educated Gloder, who quit working in the financial markets to grow wine about 20 years ago.

"Now the issue with the United States is finally cleared," she said. "But even before that nobody called us to say: "Thanks, but we are crossing Brunello out."

The Consortium has boosted measures to guarantee the purity and high quality of the wine after the investigation started.

Cencioni stood by the efficiency of controls that the Consortium carries out at every step of the production chain -- from grapes to bottled wine -- and said they also employ an external company for laboratory checks.

Brunello's quality is also subject to random checks from various authorities, including tax police and sanitary inspectors, Gloder added.

"Brunello's reputation is still high. People understand that there are serious people working here," she said.

(Editing by Paul Casciato)