Wines & Vines Home
Welcome Guest

2012 Winegrape Bounty Ushers in Balanced Market

Sonoma County forum assesses grape, bulk wine market for the coming year; Nick Frey announces retirement

by Andrew Adams
dollars and $ense
The Dollars & $ense Seminar presented by the Sonoma County Winegrowers Commission included a tradeshow.
Santa Rosa, Calif.—The 2012 grape harvest may set an all-time record for California, hitting the 4 million-ton mark.

That bountiful harvest appears to have balanced the grape and bulk wine market that had slipped to a short position by winter 2011-12, said Glenn Proctor a partner with Ciatti Co. wine brokerage. “When we look at the market today, it’s balanced,” he said.

While the state’s official tonnage count won’t be released until next month, Proctor said Ciatti’s own records and estimates indicate the 2012’s harvest will weigh in at 3.85 million tons. (The figure could shift down to 3.7 million tons or as high of 4 million tons.) The strong harvest comes after a few years of “turbulent” market conditions resulting from a sluggish economy and adverse weather.

Proctor’s comments came during the Dollars and $ense seminar held Thursday afternoon at the Wells Fargo Center for the Arts in Santa Rosa and organized by the Sonoma County Winegrowers.

During the conference John Balletto, chair of the Sonoma County Winegrowers Commission, announced that the group’s executive director Nick Frey would retire this year. He said Frey would continue to work part time to help the group find his replacement and ensure a smooth transition.

Balletto said the winegrower’s group, Sonoma County Vintners and the tourism board are committed to continuing their cooperative efforts to build and market the county’s wine industry. He added that the groups plan to all pass resolutions codifying that cooperative effort. “The cohesion we have today will be set in stone,” he said.

A reverse in the market
Proctor said the grape and wine market reversed from a few years ago, when growers struggled to find buyers; then, in 2012, the grower took the driver’s seat. Improved market conditions also coincided with optimum growing conditions. “They won’t tell you it was a good year, but they sure smile a lot,” Proctor said of the state’s winegrape growers.

The large harvest came through better yields on the state’s existing acreage. Proctor used Sonoma County’s Pinot Noir harvest as an example, saying he’d heard from growers who usually harvested 4 tons per acre, expected to pull in 7 tons and ended up with 9 tons per acre.

Proctor said Sonoma County growers produced 36,000 tons of Pinot Noir, 40,000 tons of Cabernet Sauvignon, 19,000 tons of Merlot and 15,000 tons of Zinfandel. He remarked the strong Merlot harvest came from just higher yields and good berry size. Chardonnay totaled 70,000 tons, and Sauvignon Blanc rebounded from 2011’s weak harvest with 13,500 tons.

The county’s grape prices saw good growth from 2010 with the high price for Chardonnay rising $1,400 per ton to $2,500, Cabernet doubling to $3,000 on the high end, and top-end Pinot Noir increasing from $2,800 to $3,800.

Growers also enjoyed being in a strong negotiating position for 2012. Proctor said many reported a very early and competitive purchasing season with “desperate and unprepared” buyers, long-term contracts and planting contracts for Cabernet Sauvignon. “The sellers controlled the market dynamics through most of the season,” he said.

A survey of growers by Ciatti found that most expect grape prices to stay flat or see modest growth, and about half are getting interest in planting contracts. They reported the most-needed variety is Cabernet Sauvignon, with Pinot Noir a distant second and the two least-popular varieties are Syrah and Zinfandel.

Chris Welch, who is also a partner at Ciatti, said the market is largely balanced, although Chardonnay could be a bit long. He said he’s also unsure how the bulk market for Pinot Noir may play out because of the state’s strong harvest.

So far in 2013, he said he’s seeing interest in from parties looking to get a deal on some of the excess premium chardonnay that wineries may have made expecting to sell as bulk.

Prices for bulk wine have generally slipped from where they were in 2010-11. Sonoma County Pinot Noir has slipped from $26-$32 per gallon to $14-$22, and Napa County Cabernet Sauvignon went from $30-$50 per gallon to $24-$35.

Welch said the custom-crush option for growers is here to stay. Because there are so many negoçiant and private label companies these days, Welch said growers can easily find a buyer if they decide to hang on to their fruit and make wine. He said making quality wine can help them demonstrate that they know what’s best for their vines, and it gives them a comparative option when evaluating an offer for their grapes.

Imports a growing challenge
But just as California pulls in what could be a record harvest, the state is awash in a flood of foreign wine. The equivalent of 40 million cases of imported wine came to California in 2012 as major producers adjusted their supplies to meet strong demand and a short California bulk market.

With the domestic demand for wine expected to outpace California’s potential supply, Proctor said the market share of imports could increase. He said France has just allowed producers to put a vintage date on wine with just a France appellation.

He also identified Chile as a country that is poised to be a strong importer to the United States, saying the Chileans have a strong infrastructure for producing bulk wine of popular varieties like Cabernet Sauvignon, and they trade in U.S. dollars. Chile grew 1.97 million tons of winegrapes in 2012 and was selling Cabernet Sauvignon at around 75-94 cents per liter ($2.84-$3.56 per gallon).

Currently no comments posted for this article.

Wines & Vines Home
866.453.9701 | 415.453.9700 | Fax: 415.453.2517
65 Mitchell Blvd., Ste. A San Rafael, CA 94903
Wine Industry Metrics
Off-Premise Sales » Month   12 Months  
October 2014 $570 million
$7,775 million
October 2013 $539 million $7,342 million
Direct-to-Consumer Shipments » Month   12 Months  
October 2014 $284 million
$1,751 million
October 2013 $240 million $1,556 million
Winery Job Index » Month   12 Months  
October 2014 139
October 2013 131 192
MORE » Released on 11.13.2014


Practical Winery & Vineyard Library
Search the PWV archive »

Direct To Consumer
Wine Shipping Report
Download full report »

  • December 2-4
    Vinitech Sifel in Bordeaux
  • December 3
    Sustainable/Organic Wine Production Seminar
  • December 4
    North Coast Wine Industry Expo
  • December 6-7
    Wine Chemistry Workshop in Oregon
  • MORE »

Article: Kluge Saga Continues in Virginia »
Not everybody likes Pat Kluge, but she and Moses built a first class winery /...
Reader: Josh Moser
Article: Canada Adapts to Kegged Wines »
I am a wine agent in Manitoba & there certainly are kegs of cider here....
Reader: Guest
Article: What's Your Winery's IP Worth? »
If you would like more information on this seminar please visit The Seminar Group's website....
Reader: Danielle Bingham
Article: DtC Is Lifeblood of Wineries, Banker Says »
Seems like another locical option would be to have more small niche distrbutors. Consolidation of...
Reader: Guest
Article: Tasting Wine From PD-Resistant Grapes »
Congratulations Andy! Lots of grapebreeders and southern growers will be looking through the catalogs. i...
Reader: Guest

Directory/Buyer's Guide — Your Wine Industry Marketplace
Advanced Search »
   by Product
 by Company Name or Brand
Browse by Category »
2015 Directory/Buyer's Guide
The Wines & Vines Directory and Buyer's Guide
Wines & Vines Magazine
Digital Edition Now Available!
Wines & Vines Digital Edition Now Available
The Wines & Vines Online Marketing System
The Industry Standard winery marketing application
Latest Job Listings
 Cellar Club Coordinato...
 Dundee, OR
DTC, Tasting Room and Retai
 Customer Service & Rel...
 Healdsburg, CA
DTC, Tasting Room and Retai
 Brand Manager
 Woodland Hills, CA
Sales and Marketing
 Senior Vineyard Manage...
 Rutherford, CA
 Brand Director, Austra...
 Napa, CA
Sales and Marketing
 Sales Representative O...
 Sacramento, CA
Sales and Marketing
 Production Forklift Op...
 Yountville, CA
Winemaking and Production
 Project Manager
 Santa Maria, CA
Sales and Marketing
 Wine Salesperon
 Bay Head, NJ
Sales and Marketing
 Communications Special...
 St. Helena, CA
Sales and Marketing
More Job Listings >>
Follow Us On:

Home  |  About Us  |  Editors  |  Subscribe  |  Print Edition  |  Digital Edition

Advertise  |  Site Map  |  Contact Us  |  Privacy Policy
Copyright © 2001-2014 by Wine Communications Group, Inc. All Rights Reserved.
No material may be reproduced without written permission of the Publisher.
Wines&Vines does not assume any responsibility for any unsolicited manuscripts or materials.