Veritas about vino in North Carolina.

• Position: ECONOMIC OUTLOOK - Interview

The number of wineries in North Carolina has grown 62% since 2000 to 34, with 10 more expected to open within a year, according to the N.C. Department of Agriculture. Still, Ian Taplin says, the state's wine industry has far to go before it can compete with those of California and Oregon. Taplin, a professor of sociology, management and international studies at Wake Forest University, is co-author of a study on the growth of the industry in North Carolina.

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BNC: Give a sketch of the industry here.

Taplin: When we talk about wine production we are talking about two types of grapes in this state. One of them is muscadine. It makes a sweet wine. That is the bulk of wine made east of Raleigh. The other type of grape is vinifera. The vinifera grape is the one most of us associate with wine drinking. It's this grape that's the focus of much of the growth in the Yadkin Valley area. I would argue that the cultivation of the vinifera grape is responsible for the growth of wineries in North Carolina, the bulk of which are west of Winston-Salem and going northward. It's my understanding that vinifera grapes won't grow south or east of there.

Describe the wineries.

There are three types. First are the large, capital-intensive wineries. They generally have 40 acres or more of vines and startup capital costs that exceed $500,000. Second are the small- to medium-size wineries. These were started by farmers who owned agricultural land, then switched from tobacco to grapes. The acreage is anywhere between 10 and 60, but startup capital costs are generally in the $250,000-to-$500,000 range. Finally, there are small, boutique wineries with generally less than 10 acres under vines. These are low-volume operations with minimal startup capital costs, probably less than $100,000. This is the fastest-growing category of wineries and also the ones where profits, albeit small, are most likely to be made.

Why has wine production taken root?

Climate and soil conditions in this state are consistent with growing grapes. You have some entrepreneurs who have started to grow grapes and market wine. You have a small, historical winemaking tradition. You have agricultural infrastructure--people who are familiar with farming. Then you inject the decline of one of the staple agricultural industries in this state: tobacco.

What is tobacco's role?

In 1998, the four big tobacco companies settled the lawsuit brought against them by the Medicaid system. The...