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Gallo Wants To Build Bottling Plant In South Carolina

by Kerana Todorov
March 18, 2021
E. & J. Gallo is purchasing about 600 acres near Fort Lawn, South Carolina, to build a bottling plant. Modesto-based Gallo operates wineries in California, Washington state and New York. Graphic courtesy of the U.S. Army Corps of Engineers.
 

E. & J. Gallo plans to build a new bottling plant in South Carolina, a facility that would serve as Gallo’s main hub east of the Mississippi, according to various reports. 

The world’s biggest wine company plans to build the plant on more than 600 acres in Fort Lawn, Chester County, in an area once known for its textile mills, according to the multiple sources. Fort Lawn is about 45 minutes south from Charlotte Douglas International Airport and an hour north from Columbia, SC.

Modesto-based Gallo plans to invest more than $400 million over the next eight years and hire nearly 500 employees, Rob Donoho, head of Gallo’s global chain functions, told South Carolina state legislators on March 9. It would only be the first of five phases, Donoho noted.

“This is really intended to be our East Coast home for the Gallo enterprise for decades and decades to come,” Donoho said.

The plant, which could be reached by rail, would be designed to bottle wine in different formats, including glass, cans, bag-in-box and small plastic bottles, according to Donoho. It will also be a warehousing and distribution center for wine bottled in California and shipped to Chester County, according to Donoho’s presentation. The company could also produce its own cans on site, Donoho said.

Gallo, an importer and exporter, also plans to “double or triple” its operations at the Port of Charleston, according to Donoho. 

No timeline has been given. Still Donoho and other representatives spoke of the company’s commitment. 

“We do actively want to come to South Carolina. There has been a tremendous vetting process,” Donoho told the South Carolina Senate Judiciary subcommittee which is considering a bill to allow Gallo to have up to four satellite tasting rooms for educational and marketing purposes. “We’re very close to closing the deal,” he said.

Donoho cited the economic and environmental benefits of having the plant in South Carolina, given that about 70 percent of its customers are on the East Coast. 

“Being a wine grape producer on the West Coast puts us at a logistics disadvantage to getting products to our consumers,” Donoho said. Shipping “heavy” glass bottles and cardboard cross country, he said, was “very expensive.”

Instead, it is “much cheaper“ for the company to ship its wine to the East Coast and source the glass and other packaging locally, Donoho said. “There is a tremendous logistics advantage to doing that.”

Donoho also noted the “sustainability” benefit of “not burning as much fuel to get the product to the consumers.” 

The state’s other benefits would include supply chain revenues and the demand for trucking services, according to the presentation. In addition, the satellite tasting rooms Gallo wants to open could spur tourism, Donoho and others said. 

Minimum wage in South Carolina is $7.25/hour. 

Among the factors that led Gallo to choose South Carolina to build its “East Coast home,” Donoho cited South Carolina’s business-friendly climate, its location to the port of Charleston, and S.C. Ready, a state-sponsored job training program. “It’s truly one of the things that attracted us to the state,” he said. 

Donoho addressed the subcommittee as the state Legislature considers S. 619, a bill that would allow Gallo to have up to four satellite tasting rooms in the state. Gallo’s representatives have called the provision a “critical” point to the company coming to the state. The tasting rooms will be a marketing and educational tool and will build brand awareness, Donoho said. Their locations for the tasting rooms, which could be 800 to 1,200 square feet, according to Donoho, were not specified.

South Carolina’s top elected officials, including Gov. Henry McMaster, have strongly backed the Gallo project in Chester County. 

In a March 9 letter to the state legislators, McMaster urged support for S. 619. Gallo was “very close to announcing a once-in-a-generation $400 million capital investment in Chester County that will create nearly 500 jobs,” McMaster wrote. The investment will “transform the community and contribute greatly to South Carolina’s economic prosperity.”

E. & J. Gallo, he wrote, “is a well-respected, family owned company with products that are distributed across the globe.” 

South Carolina State Sen. Brad Hutto, D – Orangeburg, voiced support for Gallo, noting the jobs that could be created. “We look forward to having them,” Hutto said, referring to Gallo.

The Senate Judiciary subcommittee was scheduled to meet again Thursday regarding S. 619. Current state wine law does not address satellite tasting rooms. The legislation was drafted after the South Carolina’s Department of  Commerce, which is helping Gallo come to the state, approached the Department of Revenue to figure out the next steps, according to testimony before the state’s Senate Judiciary subcommittee. 

The state Department of Commerce has submitted an application to the U.S. Army Corps of Engineers to seek a permit to build the plant. Construction would require filling about 1 acre of wetlands and about 8,000 feet of tributaries, according to the public notice. The environmental evaluation of the project is under way, according to the federal agency.

Gallo’s name was not mentioned as the applicant behind the Fort Lawn project until recently. 

The financial agreement between Gallo and local officials has not been unveiled either. The Chester County Council has discussed the project, code named “Project Magma,” in closed-door sessions.

The secrecy did not sit well with Michael McLain who lives near the site where the proposed Gallo facility may be built. He found the identity of his potential new neighbor through the U.S. Corps of Engineers, he said. “You’re not watching after us,” McLain told the Chester County Council early March.

The plant is going to “squash the value of my property and my home and is going to be annoying the crap out of me every morning and every evening by being right across the street from me, shining lights in and out of my house,” McLain said.

This week, however, a manager at The Wagon Wheel restaurant in Fort Lawn said the Gallo plant would bring jobs to the community.

The South Carolina Department of Commerce and a Gallo representative declined to give more specifics on the company’s South Carolina plans. 

“E. & J. Gallo Winery is constantly reviewing the strategic options of its business in order to meet growing global demand; toward that end, we are exploring potential operational investment opportunities on the east coast. Nothing is finalized at this stage and we don’t have specifics at this time, however we are continuing to explore strategic options within our business as we plan for the future,” Gallo representative Natalie Hoch Henderson said in an email.


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