Until the early 1990s, Argentina's wine industry was focused inward, as the local market's thirst was sufficient to absorb the huge quantities of everyday drinking wine produced there. But with per-capita consumption in the domestic market in sharp decline since the mid-1970s, Argentina's wine producers realized that they had to look to export markets to remain in business, and winemaking in Argentina began its transformation.
In just a few short years, Argentina has shifted its emphasis to the production of quality wine and turned its attention to export markets. Vine yields have been reduced dramatically. Large old wood casks have been widely replaced by oak barriques. And a major wave of new planting has taken place in mostly cooler, high-altitude sites that are better suited to producing serious wines, such as the Uco Valley, in the foothills of the Andes, about 80 miles south of the city of Mendoza. Despite the widespread reduction of vine yields, Argentina remains a huge wine producer, ranking number five in the world. Red Argentine wines, especially those from Malbec, Cabernet Sauvignon, and blends incorporating these two varieties, represent the lion's share of the best bottles.
Many of today's finest Argentine wines have barely five years of history. Consulting winemakers from California and Europe have brought their technical expertise to Argentina, as well as their knowledge of what is necessary to compete in the world wine market. At the same time, there has been an explosion of foreign investment by wealthy wine producers, luxury corporations and individual investors attracted by inexpensive vineyard land and by Argentina's warm, dry climate. Since the Argentine peso was sharply devalued in late 2001, land prices have been even more attractive to outside investors.