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In Vodka, a Taste of Maine

October 06, 2009 - FREEPORT -- When Chris Dowe looks at the three one-ton bags of potatoes in the distillery, he sees vodka in the raw. The characteristics of the potatoes remain key as they are cooked into a soup that is fermented into wine and triple-distilled. Even after the alcohol is mixed with water, Dowe can trace the vodka's origins back to the potatoes.

"Ours comes out very smooth," said Dowe, managing partner and head distiller at Maine Distilleries. "The flavor is very distinctive. This is more a traditional vodka."

Dowe and his partners are hoping that Cold River Vodka's distinctive taste will continue to catch on. In addition to their product's flavor, they are also betting that its status as a Maine product, its craft approach and its anticipated organic certification will win followers.

Cold River Vodka sales represent a tiny slice of the super-premium market, which has experienced skyrocketing growth in recent years. The vodka's makers hope to convert consumers of other, bigger high-end brands, like Grey Goose, Chopin and Belvedere. Since its 2005 launch, Cold River Vodka's distribution has expanded from Maine to 18 additional states, western Canada and London, winning accolades along the way.

Last year, Maine Distilleries sold 3,300 12-bottle cases of Cold River Vodka. This year, sales are expected to be between 4,000 and 5,000 cases, and the goal for 2010 is 7,000 to 8,000 cases, said Bob Harkins, the company's managing director of marketing and sales. A bottle retails for $33 in Maine and between $35 and $39 out of state.

The company, which is not yet profitable, has been feeling the effects of the recession, particularly in bars and restaurants. Harkins said the company's strategy of getting the product into mouths and building its base one account at a time will lead to slow and steady growth.

"It's self-funded. We're into it deep. We can't go back," Harkins said. "I've got to make this work."

As part of that plan, the company introduced a blueberry-flavored version of its vodka in the past year. Dowe has been experimenting with a cranberry version but is still working on the right balance of flavors.

The combination of taste and its local origins appeals to customers who buy Cold River Vodka, said Nolan Stewart, who buys beer and liquor for Downeast Beverage Co. in Portland.

"The fact that it's being made in Maine is one of the biggest things that will sell it on this one," especially for visitors who want something unique from the state, he said.

Dowe said that with potatoes, some sugars remain unfermented, leading to a sweet flavor and smooth feel. The fermentation is more complete with grains – the more commonly used product – and sugar in some form must be added to compensate for the sharpness of the alcohol, he said.

Within a few years, Maine Distilleries hopes to outgrow its current site, a 2,400-square-foot building on Route 1 that had previously been used by antiques vendors. The plan is to build another distillery, in Fryeburg near Green Thumb Farms, which supplies the potatoes and is owned by one of the company's four partners, Donnie Thibodeau. The water for the vodka comes from the nearby Cold River.

Donnie Thibodeau and his brother, Lee, a neurosurgeon who works in Portland, grew up around the potato farms of Aroostook County and had long toyed with the idea of making vodka to help diversify Green Thumb's operations. Donnie Thibodeau called up Harkins – Lee Thibodeau's college roommate – to ask him about the prospects for potato vodka.

Harkins, who had lost his job as an executive during the demise of American Skiing Co., did the research and found it was a promising market. Lee Thibodeau was talking about the plan in surgery one day, and his nurse anesthetist told him he should talk to her husband, who had been a consultant to breweries. That was Dowe.

The partners got into the business at a very good time for the super-premium vodka market, when there was a lot of room for niche players, said David Ozgo, chief economist for the Distilled Spirits Council of the United States.

By then, the first super-premiums had gotten consumers used to paying about $30 for a bottle rather than shelling out closer to $20 for the more moderately priced brands, he said.

The number of small distilleries has grown from almost none in the 1990s to nearly 200 today, Ozgo said.

In 2002, sales of super-premium vodka were at 1.6 million cases. By 2008, that figure had nearly tripled to 4.6 million cases.

Growth this year has leveled off because of the economy, Ozgo said.

"I would expect it to rebound," he said. "Will we have the double-digit growth we had before? Maybe."

Cold River Vodka is among the products made by a handful of small distilleries in Maine. Others are making spirits including whiskey, rum, brandy and gin – including the highly reviewed Back River Gin made by Sweetgrass Farm Winery and Distillery in Union.

A recently arrived product is Twenty 2, a vodka made by Houlton-based Northern Maine Distilling Co.

The company made its first delivery of 36 cases last week, said Scott Galbiati, who runs the company with his wife and sister-in-law. The venture has its roots in a business plan he created in 2004 for a college class. Their first product is a grain vodka, but they'd like to switch to potatoes in the future and create a rye whiskey and a gin.

"We're starting with vodka," he said. "We have this grand plan to get into different things."

By ANN S. KIM, Staff Writer, Portland Press Herald, October 4, 2009


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