A 'P&L' on the 2009 California Harvest

     There are two ways to look at the annual winegrape harvest in California: in tons crushed, and from a purely business perspective. As much as we like to romanticize the world of wine, there can be no romance without a successful business model.

     Each year, Turrentine Brokerage issues a report on the California harvest, skewed to the business side of the ledger. Here are excerpts from the company’s report on the 2009 harvest…  

     * Chardonnay, the most widely planted white wine variety, was up a substantial 28% statewide in 2009 compared to 2008, which is an increase of 26.5 million gallons or almost 133 million bottles (more than 11 million cases).

     “Vineyards in the Northern Interior damaged by frost in 2008 came back with a vengeance in 2009, resulting in a 49% increase in production driven by high yields per acre,” noted Turrentine’s Erica Moyer.

     * Cabernet Sauvignon, which is the largest red wine variety, was up a substantial 35%, the equivalent of nearly 8 million cases, from the very light 2008 harvest. Compared to the five-year average, however, it was only a 2% increase, which is not much for the fastest growing major variety.

     The large rebound over 2008 will likely be a benefit for brands sourced from the Central Coast and the Interior. The average crop in Napa Valley and Sonoma County is probably in excess of current sales.

     * Pinot Noir, which is still growing rapidly, increased by over 47% or nearly 3.5 million cases. Monterey County, which has seen substantial new plantings of Pinot Noir vineyards in recent years, overtook Sonoma County as the largest producing region for the variety in the state.

     * Merlot jumped 100,000 tons over the very light 2008 harvest. Most of that increase came from the Interior regions, especially from the Lodi area. The Central Coast also had a strong recovery after a small 2008 harvest. But many acres of Merlot vineyards have been removed since 2005, when the massive Merlot crop was almost 100,000 tons more than it was in 2009.

     * Newly planted vineyards boosted production for Pinot Grigio, which is the fastest growing large white variety in the United States. Pinot Grigio increased by 61%, equal to over 9 million gallons or 45 million bottles of finished wine.

     According to proprietary research conducted by Turrentine Brokerage, the overall inventory position of the industry is much better today than it was after the record harvest of 2005. Though everyone is dealing with the current economy, the long-term challenge will be to prepare for the growing purchases of wine by Millennial consumers and the eventual economic recovery.

Posted in The Wine Business
Members-only Wine sampler specials delivered straight to your inbox via our Cyber Circle newsletter.

%d bloggers like this: