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Jeff Bitter and Nat DiBuduo
Jeff Bitter, left, and Nat DiBuduo, worked together at Allied Grape Growers at Fresno, Calif., for 18 years. Following DiBuduo’s recent retirement as association president, the board named Bitter to succeed him.

Leadership change at Allied Grape Growers

Jeff Bitter will lead Allied Grape Growers upon Nat DiBuduo's retirement.

Nat DiBuduo is soft-spoken, with a heart for family and friends that’s larger than the industry he’s led for the past two decades.

Soft-spoken though he may be, when he talks, those in the wine grape industry and others in agriculture can’t stay away. In January each year, an international audience of over 10,000 people gathers at Sacramento, Calif., to hear his state of the wine grape industry address at the Unified Wine and Grape Symposium. Every July, he’s made much the same presentation to members of Allied Grape Growers at two California meetings — one in the Central Valley, another on the North Coast.

He makes similar presentations elsewhere, including at the annual meeting of the California chapter of the American Society of Farm Managers and Rural Appraisers (ASFMRA), on whose board he served from 2009-2015, including a year as board chairman.

DiBuduo, an accredited farm manager, will continue working with California ASFMRA on the newly-formed membership and marketing team, according to Suzie Roget, executive vice president of the chapter. “Nat continues to be an active leader within the California chapter,” she says. He intends to also remain active in agricultural real estate.

Allied Grape Growers (AGG), a relatively small but influential trade organization, was formed in 1951 to help California grape growers get the best price possible from wineries bent on paying as little as possible for wine grapes.

This year’s annual AGG meeting was standing-room-only for those on hand to honor DiBuduo, who retired at the end of June. It included presentations by state and federal elected representatives, and an emotional speech by California Department of Food and Agriculture Secretary Karen Ross, who had worked with DiBuduo since her days as president of the California Association of Winegrape Growers, on whose board he served.

“Serving California wine grape growers since 2000 has been the pinnacle of my career,” DiBuduo said.

SOUGHT FAIR PRICING

His efforts to secure higher prices for wine grape growers is well-known in the industry. Each year he and his long-time vice president of operations, Jeff Bitter, have actively encouraged growers to sign contracts with wineries in order to protect themselves financially.

Reflecting on his years with AGG, DiBuduo says candidly that the hang time issue is one he would have liked to have resolved with the wineries. The issue is with wineries asking growers to let grapes hang on the vine longer in order to achieve higher brix (sugar) levels. While that works, it also causes grapes to dehydrate, and because growers are paid on tonnage, it reduces their returns.

“So, growers are being shorted that tonnage,” he says, “and I’ve complained about it the entire time I’ve been here. We’ve been trying to work with the wineries on picking the grapes a little earlier, but if they’re going to wait longer for the added sugar, then they should compensate growers for the higher brix.”

Over the years, some wineries have added sugar bonuses to their contracts — a win for DiBuduo and AGG. But others ignore the issue and pay simply on raw tonnage. “So, I guess that’s both a win and a loss for me,” he says.

Contract issues have been key for DiBuduo, who sees them as the only way growers are protected from disputes with the wineries.  “Contracts have changed over time,” he says. “We’ve tried to fine-tune them as best we can.”

Each year he would promote the concept of contracts with his growers, urging them to allow Bitter, AGG vice president of operations, to review the legal documents. “I have one guy reviewing my contracts, while the wineries have a bank of lawyers,” DiBuduo says. “The contracts are written to protect the wineries, and sometimes growers give away rights they shouldn’t.”

MUTUALLY BENEFICIAL ALLIANCE

“We don’t only affect our membership, but those around us,” he says. At the inception of AGG, growers were looking for a guaranteed home for their grapes, while wineries sought a guaranteed supply. The marriage in ideas was mutually beneficial and Allied Grape Growers was born. “It was a natural fit,” he says.

Shortly thereafter, Allied began to own wineries, and in the 1980s was larger than Gallo. But that didn’t last long. Allied was approached by a company with holdings that included Kentucky Fried Chicken, and sold its wineries to Heublein, receivig a 99-year supply contract that guaranteed the organization a home for its grapes.

Then, along came Cesar Chavez and the United Farm Workers Union, which tried to bully Allied into a contract by threatening to boycott KFC. When AGG refused to sign the contract, Heublein refused to buy Allied’s grapes — a violation of its contract with AGG, and AGG got all its wineries back.

By about 1987, Allied was again out of the winery business after selling its wineries to Constellation. Since then, AGG has operated as a wine marketing cooperative, with the goal of gaining the best price and conditions possible for member growers.

With about 450 members, AGG currently reflects about 5 percent of the overall wine grape industry by crush volume, from a territory that spans from Kern to Lake counties. Allied currently has no membership on the Central Coast, though DiBuduo believes those growers share similarities with Central Valley wine grape farmers.

‘NEED SOME HELP’

“I think they need some help with marketing on the Central Coast,” he sayd, noting that some Central Coast wine grape growers may not be receiving fair prices from wineries for their grapes. “There were some Cabernet grapes that went unharvested last year in certain areas around Paso Robles.”  Some of that had to do with brix levels, some due to virus in the grapes, but others were due solely to price, he says.

DiBuduo also speaks honestly about his long-standing desire to attract quality grape growers to the organization, actively recruiting growers with quality fruit into the organization. “We’ve invited better growers into our membership. We’ve also sorted out the bad ones, and let go some of the problem children. Our field staff are all good, trained viticulture specialists, and we’ve tried to help growers get better if they wanted to. I don’t need to try to sell poor fruit.”

Over the years DiBuduo has also stressed continuing education for his staff as they work with growers in their regions to produce better wine grapes. Over time, the staff also grew — the North Coast now has three field representatives, compared to just one when DiBuduo started, in Lodi there are now two field representatives, and now there are three based in the Fresno office.

He has a long list of industry appointments and community service accomplishments, including, but not limited to, the Fresno Planning Commission, Fresno State Foundation Board of Governors, California Department of Food and Agriculture PD/GWSS board, an at-large position on the California Association of Winegrape Growers board, and Friends of the Fresno Fair. He was recently honored by the California ASFMRA Chapter with its 2018 California Distinguished Agriculturalist of the Year.

A SMOOTH TRANSITION

Jeff Bitter, DiBuduo’s long-time vice president of operations, was a seamless choice to lead Allied Grape Growers upon DiBuduo’s retirement is. Bitter was with AGG for about two years prior to DiBuduo’s hiring. “I’m happy to be leaving the organization in Jeff’s hands,” DiBuduo says.

Bitter was hired 21 years ago after then-president Barry Bedwell created a new administrative position to assist with daily duties. Bitter had just finished his studies at Fresno State, where he earned an agricultural business degree. He immediately began studies toward his MBA at Fresno State, and was graduated from the program the same month DiBuduo was hired as AGG president.

His experience with the organization aided in a smooth transition for DiBuduo to become president, and his experience now provides a similar segue for the organization’s leadership going forward.

INDUSTRY CHALLENGES

The wine grape industry appears to now be in a period of stability, says Bitter, but he cautions that this can change quickly with a particularly short or abundant crop. Still, planting continues at attrition rates, and no new net acres are being added, though production is increasing somewhat because of new variety choices and cultural practices.

Large crops can more easily throw the industry into a tailspin, Bitter says, and it can take longer for the industry to work through the supply. Conversely, the same is not true for a short crop; imports can easily be brought in by wineries to make up for reduced domestic supplies. “It’s very convenient for suppliers to add imports when we produce only 10 percent of the world’s supply of wine here in California,” he says.

Bulk wine imports, which were non-existent up until the mid-1990s, have now become a player in the marketplace. As the wine market grows in general, new dynamics are also taking place, he says. For instance, Europeans are not consuming as much wine as they once did. This is pushing European wines — particularly those from Spain — into other markets, including the U.S.

Contract issues went well this year, Bitter says. Growers of premium grapes did quite well; that market “has been on fire” for some time now, as pricing “is as strong as it’s ever been,” he says.

Additionally, wineries are buying up premium brands and adding them to their collection of offerings. It’s much easier, Bitter says, for a winery to buy a popular, established brand and move it through its distribution channels than it is to build a premium brand from scratch.

BETTER VARIETY CHOICES

Pricing is also rebounding in the Central Valley, though Bitter is not ready to say that most growers could produce wine grapes sustainably in the Valley. “I think there are still challenges here.” He told growers at his Fresno annual meeting to not accept offers for Thompson Seedless grapes under $325 per ton.

Wine grape growers in the Central Valley are becoming better at identifying good rootstock and clonal combinations for the soil and climate conditions in the San Joaquin Valle, he notes; for instance, cool climate varieties don’t belong in the Valley. When looking for grapes in the SJV, “You want those that retain their acid levels naturally, because Valley grapes tend to lose their acid naturally due to the warm nights.”

Bitter grows Petite Sirah, Muscat Canelli, and Petit Verdot just north of the San Joaquin River in Madera County.

He is confident in the direction of Allied Grape Growers, telling members recently of several in-office changes he’s made as he builds his management team and develops a new social media presence to promote the association.

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