California Has Record Grape Crush

After many years of holding back on planting new vines, winegrape growers started planting a few years ago, and now those vines are bearing fruit. The new vines have pushed production  up to more than 4 million tons for the second consecutive year, according to estimates.

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The incredible production brings up an interesting question, said Nat DiBuduo, president and CEO of Allied Grape Growers, at the annual Unified Wine & Grape Symposium in Sacramento. “2012 and 2013 were the first 4 million ton crops in California,” he said in January at the “State of the Industry” session, “but that may be the new average for the future.”

That was the first of seven key industry questions — “How did  the 2013 crush size up?” — that DiBuduo asked and answered during his presentation. The 2013 crush is estimated at 4,050,000,
up 1% from the 2012 crop. Demonstrating how large the latest crops are, the 2013 crop is 11% above the four-year production average. Listed below are the remaining six questions, and their answers.

How Many Acres Do We Really Have?

This is a tricky one, said DiBuduo. “The actual acreage is much more than the state has historically reported,” he said.

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Allied Grape Growers’ estimate for 2014 is 555,000 bearing acres, plus 90,000 non-bearing acres, for a total of 645,000 acres. “And we’re still planting,” he said. “You look at the trend; where’s it going? It’s going up.”

Is The Market Balanced Now?

There have been some rather specious reports of a wine shortage, but DiBuduo didn’t take long to dismiss them. “Yes,” he said, “there is no wine shortage.”

What Are Growers Planting Today? (Other Than Almonds)

Only 29% of the grapes planted in 2013 were for white wines, with a whopping 71% for red wines. The dominant variety was once again Cabernet Sauvignon, with 29.4% of all varieties. The only others topping the double-digit mark were, in order: Chardonnay, 13.7%; Pinot Noir, 12.5%; and Zinfandel/Primitivo, 10%. “The Muscat planting craze has pretty much stopped,” DiBuduo added.

What Are Today’s Issues?

“Water, water, and water,” was how DiBuduo summed up by far the top issue. The other grower issues were: the market and contracts (maximum tons/quality/terms), scheduling/delivery (hang-time), vine diseases/pests (impact on suitability), labor (mechanization), and sustainability.

What About The Drought?

The rest of the grower issues above pale in comparison to the drought, which affects different growing regions in different ways, he said. “I get asked 100 times a week: What’s happening on the west side of the San Joaquin Valley? Are those grapes going to be abandoned? No,” said DiBuduo, “but you’ll be paying more for your veggies.”

Will Our Domestic Supply Depress Import Growth?

“Yes,” he said after displaying several charts. “Based on market behavior in the recent past, it should.” However, he did note that the trend line does show production outpacing shipments in 2017. “But that’s just a trend,” DiBuduo insisted, the market should stay in balance. “We just need to increase consumption.”

Final Thoughts

In concluding his presentation, DiBuduo left the packed, standing-room-only Hyatt Regency ballroom with the following thoughts:
• “The future looks bright for California and American grown grapes and wine but, as always, we need to be cautious and plan diligently to match future growth potential.”
• “The opportunity for grower and winery profitability stays with us. A balanced supply will underwrite the ability for all in the business to continuously achieve profitability.”
• “Sustainability continues to be an industry priority. We all need to work together to assure the success of our industry, our workforce, our communities, and the reasonable protection of our environment; but most of all we have to stay focused on those things that create economic sustainability.”

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