News

Region Specific Report - August 2012

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

Global Market Update − July 2012

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
holidays.

Posted in: USA, Canada, Chile, France, Germany, Argentina, Australia, South Africa

Global Market Update − June 2012

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
to success.

Posted in: USA, Canada, Chile, France, Germany, Argentina, Australia, South Africa

Low Concentrate Stocks Globally Cause High Prices

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