What is in this article?:
- The California raisin-type grape crop is huge compared to last season — bringing benefits and problems.
All is not well
However, not all is well.
“Wineries are complaining this year about a lack of space for a big crop,” he said, noting that the tanks are full from last year’s big crop and bulk wine brought in from overseas.
“Some wineries are cutting off deliveries, freeing up excess tonnage,” he said.
Wineries are adding new storage. Gallo is adding 40 new tanks to its Clovis, Calif., winery. That represents 600,000 gallons of additional storage. Gallo has also built a new winery at Livingston with 70 additional large tanks.
“There is considerable capital development by all wineries and that is a good sign,” DiBuduo said.
“The outlook for the industry as a whole still looks good. Exports are up. U.S. consumption is up.”
DiBuduo has been a bit skeptical of late that California growers would not be able to meet future demand because vineyards were not being planted to meet future demand because other crops were more profitable.
He is more optimistic now.
“We are on target to match that demand, especially with the planting of valley grapes over the past two to three years,” he said. Premium wine grape suffered more from the recession, but DiBuduo says that is turning around and headed in the right direction.
“However, there is still a target on our back since the U.S. is the largest wine market in the world and everyone wants to ship wine here.
However, not all is rosy. Despite record raisin prices and strong Thompson prices, raisin-type vineyards continue to be taken out. An estimated 80,000 to 100,000 acres of mostly SJV Thompsons have been pushed out in the past decade.
Both DiBuduo and Goto expect another 15,000 acres to come out this winter because competing crops like almonds and pistachios offer more profit potential and are far cheaper to develop than a new vineyard.
Land prices continue to go up as demand for nut orchard groups skyrockets.
“Unfortunately, prices for a vineyard are roughly the same as for open ground, about $20,000 per acre. That says a lot about the plight of Thompson growers,” Goto said.
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