February 13, 2013 - 15:05
February 8, 2013
Contact: Lora Parnell, email@example.com (415) 458-5150
2012 WINEGRAPE HARVEST LARGEST CROP TO DATE, UP 20% FROM 2011 AND 7% FROM HISTORICAL 2005 CROP
For Immediate Release
The Preliminary California Grape Crush Report released today shows the 2012 Winegrape crop reached an all-time high of 4.014 M Tons, which was surprising given the limited amount of new planting in the state. This production was needed given the shorter crops from the previous two years and the growing consumer demand for case goods. This will provide supply to wineries and bring the overall market back into balance as we enter 2013.
The state 2012 Pinot Noir crop size reached its highest yet of 247,000 tons up 45% overall from 2011. Monterey and Sonoma county Pinot Noir crops were up over 85% vs. last year. We experienced yields per ton on Pinot Noir in many areas that were not thought possible.
Quality for 2012 should be outstanding, with winemakers with many years of experience saying this is the best quality year they have ever seen.
This large California crop was driven by historically high yields in the Central Coast, Napa, Sonoma, and Lodi. The Central Valley was up but just slightly over last year.
The Cabernet crop in California was the largest since the historical 2005 crop. Demand continues to remain strong and we will see more new planting over the next few years. The 495,622 tons harvested was needed for growing case good sales.
Bulk wine imports, which grew to approx. 40 M equivalent cases in 2012, will continue to affect the demand for California grapes in the future. This large increase in imports has been partly due to the recent grape price increases.
The grape and wine market, with the healthy 2012 crop, have moved into a balanced position and wineries and growers should be able to see mutual profitability. The larger crop and inventories should push the bulk wine market pricing down from the highs of last year, but may have less of an effect on grape pricing. However much of these pricing changes will depend on case sales growth over the next year.
Consumers should see more availability of California wine in the market place and the larger crops of Pinot Noir and Chardonnay state wide should help to keep prices stable.
2012 Grape Pricing increased by upwards of 20% in many areas of the state. Multiple buyers where caught needing supply and drove the rise in pricing in these areas. Wineries are now trying to decide if they will pass these costs of goods increases to the consumer or adjust their margins.
Please call Glenn Proctor or John White at the Ciatti Company 415-458-5150 for further discussion, and insight.
The Ciatti Company is the worlds largest and most comprehensive bulk wine and grape brokerage. Aside form its home base in San Rafael, California, seven offices around the world provide clients the kind of information and intelligence that today’s competitive global wine industry demands.
The company, founded in 1972, has deep roots in the wine industry, both in California and the countries in which the company operates. The current partnership includes industry professionals with over 135 years of collective experience including: John Ciatti, Greg Livengood, Glenn Proctor, John White, Chris Welch and Steve Dorfman.
Posted in: USA
February 7, 2013 - 15:48
2012 Harvest Outlook
Weather conditions this summer have been ideal. July had one week of extreme heat that hit the Central Valley, but with little damage reported. Our grape team has been surveying all vineyard regions and has reported the following:
• Central Valley: Other than Thompson Seedless, which looks lighter than previous years, most viniferous grapes are showing average to above average yields. Red grape yields look stronger than whites, and the northern interior seems heavier than in the South. Look for Pinot Noir, Zinfandel and Merlot to have sizable crops. Chardonnay in Lodi and the Delta continue to size up and could surprise many in the final report.
• Central Coast: Coastal vineyards have rebounded from last year’s weather-related issues. Look for all varieties to have above average yields. All reds with the exception of Syrah are showing excellent quality and quantity. In Monterey County, Chardonnay always has the potential of sizing up prior to picking, while Pinot Noir could fair the best of all varietals.
• North Coast: Similar reports of average to above average crops for all varieties. Napa Cabernet Sauvignon looks strong with the potential for very good quality. Sonoma Pinot Noir and Chardonnay have solid crops and are disease-free. Merlot all around the North Coast is looking big.
• Recent bulk sales have slowed as is typical of the summer months. We have observed the top side of pricing start to recede from the highs of early spring. Grape activity continues to focus on Central Valley grapes where available. Pricing has remained solid.
• Look for labor and trucking shortages during this year’s harvest. It is apparent that many plantings and replanting are taking place in all regions of California. Many new vines have gone in the ground in the last few months. The timing of this years harvest looks normal compared to the last few years. Crop size and weather patterns will confirm this trend.
• Per the most recent Gomberg-Frederikson Report, bulk wine imports continue to arrive into the United States. Over 46 million gallons have been imported so far this year (+167%). In contrast, bulk wine exports from the United States have been declining (-5%).
Posted in: USA
July 10, 2012 - 09:51
Multi-year grape contracts with strong pricing continue to be signed throughout the state, as wineries continue to secure supply. In addition, bulk wine sales are
also being signed, though pricing may have peaked.
Crop estimates throughout the state project the potential for an average to above average 2012 harvest. Favorable weather and good berry sizing in the coming
weeks will confirm the final crop size.
California sales slowed over the first quarter of 2012. The slow sales for the first four months of 2012 have been caused by the decrease of domestic bulk wine supply available for both the volume and value market segments.
California exports have shown mixed results. Packaged wine exports, led by Gallo (+11%) with control over 63% of all case good exports, continue to grow. Alternatively, bulk exports show year-to-date losses (down 4%), most likely due to tight supply of Zinfandel, Rosé, Colombard and generic reds.
Case good import volumes have declined 6% year-to-date, while bulk volumes have increased by 147%, representing the equivalent of an additional 9.5 million cases. The growth in imports is coming from Chile, Argentina and Australia.
Posted in: USA
July 10, 2012 - 09:47
July marks the middle of summer in the Northern Hemisphere, and expectations are for healthy crops across all of the major producing regions. After a disappointing 2011 crop, especially in California and Italy, a larger crop would be welcome relief to many buyers in the bulk market. Prices moved higher at a rapid pace in California over the past twelve months. It appears that a plateau has been reached, and some pricing softness exists for certain varieties in the commercial growing areas. Italy looks to rebound from last year’s small crop, which should help take some of the pressure off of the recently overheated market in Spain. French producers in the Languedoc saw a larger than usual crop in 2011, and are still looking to move some white inventory. The economy in Europe continues to be a cause for alarm in the bulk market, as buyers continue to send messages of concern about pricing and corresponding consumption levels.
Wineries in the Southern Hemisphere continue to push along, with strong sales reported in Chile and Australia. Argentine suppliers continue to move forward with good sales on Malbec, Muscat and generic varietals. New Zealand pricing has continued to head in an upward direction, as the 2012 crop proved to be too small to cover the market demand. South Africa continues to be a favorite destination for buyers in Europe, as the Rand and the larger than normal white grape harvest, have allowed for strong buying opportunity. Overall, the market seems to have cooled slightly, after the extreme highs experienced over the past twelve months. It remains to be seen whether this is a trend, or simply a seasonal lull, as many players in Northern Hemisphere are now deep into their summer
July 10, 2012 - 09:29
All regions of California are reporting early potential for an above average crop, due to positive spring weather and aggressive pruning practices. With frost issues behind us and
most vineyards completing bloom, growers and vintners will now wait for berry sizing over the next 45 days. The coastal regions are expected to bounce back after last year’s frost damage, with solid yields across all varieties. Current demand remains strong for all varieties, with pricing continuing to push to new levels. The state’s interior growing region also shows promising potential, especially in northern vineyards. Bunch counts on table and raisin varieties look to be down, after having had solid crops over the past few years. Overall, it is our belief that California vineyards are currently contracted at the highest percentage and most sustainable prices seen in the past 15 years.
First quarter sales show mixed results. Some wineries expanded and others declined. Volume brands are beginning to feel the effects of the lower production from past vintages, the shifting of inventory to higher intended uses and smaller package sizes, and the many recent price increases. Wines priced above $15 per bottle retail are continuing to see solid growth, as our economy tries to recover. Today's growth, in comparison to the past, is impressive given the industries removal of deep discounting and promotional support, and releasing of lower price brands aimed to reduce inventories at all price levels. Bottled imports have decreased (-8%) this quarter with only France, New Zealand and South Africa increasing. In contrast, bulk imports more than doubled in both volume (+119%) and value (+116%) for the quarter. Many of these wines will fulfill the shortages found domestically. The upward trend for sparkling wine sales within the US continue for both domestic (+14%) and imported (+8%). Export of California wines to outside markets continue for both cased goods (+6%) and bulk (+5%) for the quarter.
Posted in: USA
July 10, 2012 - 09:22
During the past two years of producing this update, we have seen the global economic world
continue to remain in a state of flux. Nimble producers that have kept a flexible sourcing model in
this evolving world continue to prosper.
Currently, European economic concerns dominate the headlines; opportunities have now
presented themselves in the bulk wine markets. As investors move away from the euro, and
towards the relative safety of the dollar, the resulting gain in dollar strength has made several
import markets more appealing. Wine from South Africa has attracted the most attention as the
SA rand dropped significantly in value against the rebounding dollar. Chardonnay and dry white
wine seem to be attracting the most interest from buyers today. The Australian dollar and Chilean
peso have also seen relative weakening against the dollar, and wines from those countries are
beginning to tempt buyers as well.
The Southern Hemisphere harvests are all winding down, and it appears that we have mixed
results. South Africa and Chile look to be above average, Australia is reporting an average
harvest, and Argentina and New Zealand have come up short. Producers are starting to make
estimates in the Northern Hemisphere, and it is believed that California is looking at a larger than
average 2012 crop. Recent storms in France have impacted several areas with varying degrees
of crop damage and the extent of the damage is yet to be determined but could affect future crops.
Germany and Spain have been experiencing mild temperatures and minimal rainfall. This has
allowed for good bud break and fruit set, which should result in an average crop for both countries.
While uncertainty remains regarding supply availability, activity remains strong, and prices are
holding in most markets.
A big plus for all of us in the global wine industry is that demand for wines around the world
remains relatively strong. Consumer thirst for wines from well-known producers in both new
brands, in addition to tried and true labels, continues to grow. Paying close attention to all
economic, supply and demand factors, as well as remaining agile, seems to be the current key
May 7, 2012 - 10:01
The recently released Acreage Report estimates that California has 848,000 acres of grape vines planted, of which, 6% were non bearing. Wine Grapes represented 543,000 total bearing acres and 37,000 (7%) non bearing acres. The report shows that Cabernet Sauvignon, Chardonnay, Pinot Noir and Rubired are the only varieties that have reported any significant plantings coming online. As this is an optional (non mandatory) report, many acres that have been planted are not reflected, ie Muscats. California Nurseries have confirmed significant sales of vines and back orders for future plantings of key varieties, of which Cabernet Sauvignon, Zinfandel, Chardonnay and Pinot Noir are the biggest targets for growers.
Posted in: USA
May 7, 2012 - 09:50
Domestic White and Red Grape Juice Concentrate continue to be priced at a premium as stock continues to dwindle. This is caused by strong winery and food and beverage company demand coupled with unusual export pressure from the global shortage in the Southern Hemisphere. Generic White concentrate supplies continue to shrink and Generic red concentrate, while in short supply, continues to trade at a premium because of strong international winery demand.
Posted in: USA
May 2, 2012 - 10:15
The Ciatti Company will once again be attending the London International Wine and Trade Fair.
Please come and see the Global Ciatti Team at Stand Q6.
April 10, 2012 - 10:09
The competition for bulk wine from all regions and for all varieties in California remains stiff. California is still looking at all-time low volumes on the bulk market. Producers are
concerned about the longevity of the current bulk market and sustainability of the current low shelf prices. The main concern in the California market is supply. The supply
situation is a large unknown and until frost season and harvest pass, buyers will have to continue to pay high prices or go without supply. This bulk market phenomenon has spurred on both traditional and non-traditional buyers to purchase fruit earlier in the season and seek to secure multiyear deals. Grape buyers have also been forced to make concessions regarding farming practices and tonnage limits. The majority of activity remains around the red varietals for both grapes and wine.
Posted in: USA