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Report gives insight into wine inventory.

Lee Allen, Contributing Writer

May 8, 2019

3 Min Read
Jeff Bitter, vice president of Allied Grape Growers, talks with Stephen Rannekleiv of Rabobank after a “State of the Industry” presentation at the 2018 Unified Wine and Grape Symposium in Sacramento as other panelists greet other attendees. Bitter says he was “pleasantly surprised” by the most recent grape crush.Tim Hearden

Because of the interruption caused by a federal government shutdown, there was no preliminary Grape Crush Report for 2018.  Instead, the California Department of Food and Agriculture and the U.S. Department of Agriculture’s National Agricultural Statistics Service who fund the report, issued it in a final form to act as a barometer for the grape and wine industry - with tonnage and prices of wine grapes crushed during the ’18 harvest.

According to Steve Fredricks, President of Turrentine Brokerage, California’s largest wine grape and bulk wine brokerage company, “The report provides growers and wineries insight into the inventory position for the state’s wine business as a whole, and influences market dynamics for the upcoming 2019 harvest.

“A mild summer led to larger-than-average yields per acre, particularly in the coast, and that crop, paired with slowing retail sales, led to lower contract prices for grapes from many areas of the state.  Due to the delayed release of the crush report, the industry has moved past this harvest in many ways, but we can now calculate the degree of excess by variety and region.”

Condensing the 164-page analysis of grape growing in California’s 58 counties - the 2018 crush, at slightly more than 4.5 million tons - was up 6.2 percent from the year previous with red wine varieties accounting for the largest share of all grapes crushed (up 8.8 percent), table type varieties rose by 8 percent, while white wine varieties dipped 3.8 percent and crush of raisin-type varieties dropped 12.5 percent. 

Year 2019 began with a question mark about what direction the industry would take in the months ahead and when Jeff Bitter, President of Allied Grape Growers, addressed the Unified Wine & Grape Symposium in January, he advised a need to “Dig Deeper to Adjust for the Future,” citing 2018 as a year of stability and predicting that 2019 would be a year of adjustment with California acreage for winegrape bearing remaining stable to trending to about 590,000+ acres with a modest half percent growth anticipated on crush estimates running in excess of 4 million tons.

‘Pleasantly surprised’

“I was pleasantly surprised at the total wine grape crush,” said Bitter.  “We were pretty much on target with our predictions and I’m glad the results were on the low end of our range rather than on the high side because the industry doesn’t need more inventory right now.  The numbers confirm that while we might be a little long in inventory, it’s not as bad as we thought it could be. 

“It’s never good for any individual growers to have a short crop, but from an industry standpoint, this would be a good year to come in short because we have ample inventory at the moment and there’s been a general paralysis in the marketplace in the last few months.”

John Aguirre, President of the California Association of Wine Growers, reacted this way: “The report confirms what many growers already knew, that inventories increased, and market prices softened.  But I remain an optimist that wineries will do what they have to do to clear out inventories in order to make way for the next vintage which has gotten off to a very good start.  It’s my feeling that we’re going to see people drink more California wine, and as that happens, the market will expand further.”

Input up and down the state depended on the variables of the particular geography.  In the Lodi region, Stuart Spencer, head of the 750 growers who farm 100,000 acres of winegrapes, liked his numbers - a record harvest of 850,686 tons crushed with an approximate crop value of half a billion dollars.  “Challenges lie ahead,” he said, “But opportunities exist to differentiate businesses, and efficiency, mechanization, and yield will drive this year’s Lodi winegrape production.”

For more news on pests, disease management and other issues affecting vineyards, subscribe to the bi-monthly newsletter The Grape Line.

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