America’s Growing Taste For Mezcal Is Good For Mexico’s Small Producers

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A traditional drink is giving a boost to the economy of one of the poorest states in Mexico. It’s called mezcal, a pungent booze made from the agave plant — the same plant used to make Mexico’s biggest spirit export, tequila. Investors north of the border are taking notice of Mezcal’s newfound popularity and are flocking to the southern state of Oaxaca, its main production hub.

The heart of mezcal country is in Oaxaca’s central valley. Small, traditional producers distill the spirit alongside their crops and farm animals. Mezcal is prepared in distilleries called palenques, barn-like structures where the agave plant’s thick, tall leaves are shaved with machetes and crushed. The sweet extract juices are then distilled into the smoky, clear alcohol.

Demand for mezcal is growing. Last year it was Mexico’s third-largest alcoholic export, behind beer and tequila, generating more than $26 million, according to the Mexican government.

And foreigners aren’t just drinking up mezcal — they’re also flocking to Oaxaca to see how the spirit is made up close and personal.

 

But lately, Starkman says he’s noticed a different kind of visitor on his tours: “At least once a month, I am taking out somebody who wants to export mezcal to the United States or England or Australia or Germany.”

Thomas Kalnik from Boston is enjoying the tour. He founded Peñasco, an alcohol-importing company. “We are focused on importing artisanal mezcal for distribution in the U.S. market,” he says.

And he likes what he sees — especially the high prices some mezcal is fetching these days. Some bottles go for as much as $200 in higher-end stores and bars.

With two-thirds of Mexico’s mezcal exports going to the U.S., Mexican authorities and producers are regularly traveling north to hunt for capital.

“The truth is, for us it’s a great source of support,” Hipócrates Nolasco, president of the National Council of Mezcal, says in Spanish. Without the new foreign investment, he says there would be no boom.

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