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One of the largest Portuguese wine producers, it was founded by José Maria da Fonseca (1804-1884). His father had become rich through the tobacco trade and bought his son a vineyard near Azeitãjo south of Lisbon in what is now the DOC area of Setúbal. He began building a large winery in 1834. He introduced new techniques, for example, he spaced the vines further apart and introduced the Castelão Francês variety. He planted this in a vineyard called Periquita. The wine became very successful, so that the vine was soon named after the vineyard all over Portugal and became widespread.

For the Moscatel de Setúbal, which was already being produced at the time, he created a new blend with new, more acidic varieties. Today, this sweet dessert wine is mostly produced by Fonseca. Another pioneering act was that, apart from port, he was one of the first in Portugal to bottle his wines. José Maria da Fonseca ran the winery for 50 years, and in 1857 he was awarded the title of "King of Portugal" by King Pedro V. (1837-1861) with Portugal's highest honour. In 1944, the fifth-generation descendant António Porto Soares Franco created Lancers, an enormously successful rosé wine (he had already created its predecessor Faisca in 1937, which is considered the first Portuguese rosé). The first white wine appeared on the market in 1945.

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