A California pension fund is investing US$100 million (€114m) in vineyard lands after losing the same amount on the Enron collapse.

Calpers – the California Public Employees Retirement System – lost US$105.2m (€120m) as a result of the failure of the energy trading company. Now it has identified the Pacific Northwest wine industry, and California in particular, as a copper-bottomed investment opportunity.

Despite the fact that wineries lost millions after September 11, the overall health of the industry is excellent. 2001 in California represented some US$1.8 billion (€2.05b) to vintners, and the average value of grapes has risen in the last year.

‘We believe this to be an excellent investment opportunity,’ William Crist, president of the Calpers board of administration said.

California produces 92% of all wines in the United States and is worth US$33 billion (€37.5b) a year to the US economy. The California portfolio of the Calpers investment will be completely in the north of the state. The southern region, stretching from Los Angeles to San Diego and including Temecula Valley, is not involved.

The investment is being overseen by fund managers Premier Pacific Vineyards, which specialises in the wine industry.

Written by Adam Lechmere, and agencies9 April 2002