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people picking grapes during wine grape harvest jacoblund/Thinkstock
Workers working in vineyard cutting grapes from vines.

California wine grape market adopts a wait-and-see attitude as harvest continues

Following brisk market activity for California’s wine grapes in the first half of this year, buying and selling has slowed while prices have held fairly steady as this year’s harvest moves into early September, says Glenn Proctor, a partner with wine and grape brokerage firm, Ciatti Company, San Rafael, Calif.

Although some Central Valley growers have been picking grapes since late July, many growers in the Central Coast and North Coast areas were still waiting or had only recently begun by Labor Day weekend.

“This point in the harvest is always an interesting time for the market,” Proctor says. “Although the quality of this year’s fruit should be very good, potential buyers seem to be waiting to get a better idea of the size of this year’s crop before taking any action. Some of the wineries in the Central Valley report the crops they’ve been picking are average to a little light in size.

“So they’re looking to buy a little of this and a little of that of fruit that’s available. Meanwhile, some North Coast wineries say they may need more crush capacity, because they see a little bigger crop than had been expected earlier in the season. On the other hand, some Central Coast grapes need buyers. And, interestingly enough, I’ve seen a few Napa Valley and other North Coast wineries actually put grapes on the market. I’m still trying to understand that.” 

The return of cooler weather for a week or two in mid-August, following a series of heat spikes earlier in the summer, could affect this year’s final crop size. With adequate soil moisture from the winter rainfall, the wines were able to pump up berry size and weight, once the heat abated, Proctor notes. In some cases, though, the resulting tighter clusters along with morning dew caused rot.

The North Coast crop appears to have suffered somewhat from dehydration and reduced berry weights during the heat wave that seared the area with record and near-record triple-digit temperatures during the Labor Day weekend. However, the full impact remains to be seen.

“Overall, California’s wine grape crop this year looks to be about average in size, except for the Central Valley where it definitely looks a little smaller,” Proctor says. “Unlike last year at this time, not many buyers are saying they’re a little short of fruit. So, in terms of supply and demand, the industry seems to be in a balanced state right now.

“I think most people want to get another two to three weeks into the crush to fully understand the size of this year’s crop and to watch the direction of case sales numbers before getting back into the market.”

Another reason for the slowdown in California’s wine grape market may be the decrease in case good sales in the first six months of this year, the first decline in a while, Proctor notes.

A more revealing indicator of the strength of demand for case goods will be sales in October, November and December. Typically, that period accounts for 30 percent to 40 percent of the total annual volume of case good sales, Proctor adds.

Also, participants in the California’s wine grape market may be waiting to see how lighter wine grape harvests in Europe, where frost, hail and heat lowered production in areas of France and Italy, and smaller crops in several areas of South America might affect demand for California wines, he notes.

As always, the weather will remain a concern throughout the harvest and not just because rain could damage the fruit before it’s picked.

“If the weather cooperates, the time between ripening of the different varieties will be spaced far enough apart so that wineries can make full use of their crushing capacity,” Proctor says. “However, high heat could damage the grapes and prolonged hot weather could accelerate ripening while cool temperatures could delay ripening. Either way, the different varieties might all reach desired ºBrix levels at about the same time. Then, all the grapes would come into the wineries on top of each other, creating a bottleneck and a compacted crush period.”

In fact, the typical North Coast harvest schedule fell to pieces just as it started when the early September heat wave sent crews scrambling to pick fruit in which º Brix readings and maturities spiked from the heat.

“The unprecedented spell of heat at that point in the season exacerbated harvest timing and made the always-crazy start of harvest an even crazier time,” Proctor says.

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