Written by Steve Fredricks, President
Turrentine Brokerage

On August 14^th, the National Agricultural Statistics Service (NASS) released their 2014 crop estimate for wine grapes of 3.9 million tons, down 8% from 2013. However, intelligent supply decisions cannot be made using the projection because the crush will not be 8% down on every variety in every region. An excess of French Colombard from Merced cannot substitute for a shortage of Cabernet Sauvignon in Lake County, so why should the industry pay attention to the total tons crushed projection?  The NASS is diligent in researching these numbers, but the number needs to be put in perspective. Overall statewide total tons are the combination of roughly 120 different varieties planted across 17 districts with differing vine spacing, trellis systems, viticultural practices, weather patterns, and most importantly this year, access to water. Varietal based projections and market information for the regions (including competing regions) that are vital to your business are exceptionally more valuable.

Turrentine Brokerage has been advising clients on specific market dynamics for over 40 years. Our reputable market analyses in publications and public speaking focuses on both the short and long-term market dynamics of specific varieties in various regions throughout California.

Potentially increasing the overall crop size for 2014; newly bearing acres of Cabernet Sauvignon and Muscat varieties continue to produce more fruit in the San Joaquin Valley as they mature as well as fruit from newly bearing acres of Paso Robles Cabernet Sauvignon and Pinot Noir in Sonoma and Monterey Counties.  In Sonoma County, the Pinot Noir crop has also benefited by converting from cordon to cane pruning, which has stabilized and improved yields and formed a line of defense against various diseases, such as Eutypa. In Napa Valley the early results on Chardonnay picked for sparkling wine are above estimates.  Projections for Chardonnay yields in Sonoma County and Monterey County remain optimistic.  The weather is also currently mild, which may aid in cluster weights.

Potentially decreasing the overall crop size for 2014, a warmer earlier growing season has impacted the yields on early season varieties. The impact of drought has placed downward pressure on yields in many parts of California, most specifically the Southern San Joaquin Valley and the Paso Robles regions.  Other regions have escaped major impacts from lack of water, so far.  Even in the most drought impacted regions water management has been varied: for example, some growers chose to water their highest value varieties while others left land fallow in order to irrigate established vines and trees.  Reports from some early harvesting in the south San Joaquin Valley were of a 50% reduction in yields on fields not irrigated and a 15% to 20% reduction in yields on the fields irrigated normally.  The outcome of varied water management choices makes it even more challenging to assess what the overall wine grape supply will be.   The disease pressure has been more severe in parts of the San Joaquin Valley and some regions of the North Coast resulting in a few rejections at wineries in the San Joaquin Valley.

Individual specifics for the crush this year are too numerous and varied to write in a single update and are going to be changing weekly as harvest progresses.    Turrentine brokers are talking to clients and walking vineyards every day, discussing the progress of harvest and analyzing the effects of supply on the market for grapes and bulk wine.  Call your Turrentine Broker to discuss the specific market conditions and how the upcoming harvest will affect the varieties and regions vital to your company.

For more information on the current bulk wine and grape market, click here.

Steve Fredricks, President