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Allied Grape Growers, 2014. All rights reserved.
WiVi Central Coast 2014State of the Winegrape
Industry
Nat DiBuduoAllied Grape Growers
March 19, 2014
Allied Grape Growers, 2014. All rights reserved.
Today’s presentation utilizes information obtained via Allied Grape
Growers’ (AGG) annual Nursery Survey combined with critical evaluation of reports and data made available by
the State of California. Wine shipment data is courtesy of the Gomberg
Fredrikson Report. AGG’s internal operations data along with numerous pieces of anecdotal evidence was also used in the formulation of conclusions.
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions…….
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #1:How did the 2013 crush size up?
Allied Grape Growers, 2014. All rights reserved.
California Production
Answering Some Key Industry QuestionsHow did the 2013 crush size up?
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
2005 2006 2007 2008 2009 2010 2011 2012 2013
3.76
3.143.25
3.06
3.70 3.583.34
4.024.25
4.33
3.673.49
3.673.67
Tons(in Millions)
Statewide Grape Crush 2005-2013
Other Crush Winegrape Crush
4.09 3.98
4.704.39
Allied Grape Growers, 2014. All rights reserved.
Region 2013% Change from 2012
Three-Year Average
% Above Average
North Coast 588,179 1% 520,482 13%Central Coast 593,497 8% 509,735 16%Lodi/Clarksburg 945,566 3% 848,045 11%Central Interior 2,026,213 8% 1,904,718 6%Other 91,436 2% 85,625 7%Total 4,244,891 6% 3,868,606 10%
A regional look at production, stated in tons crushed
How did the 2013 crush size up?
Answering Some Key Industry Questions
Allied Grape Growers, 2014. All rights reserved.
A look at average yields statewide
How did the 2013 crush size up?
Answering Some Key Industry Questions
2009 3,703,031 495,000 7.48
2010 3,588,985 505,000 7.11
2011 3,342,689 515,000 6.49
2012 4,018,237 530,000 7.58
2013 4,244,891 545,000 7.79
Average per acre yield from 2009-2013: 7.29
Crop Year
Winegrape Tons Crushed or Projected
AGG Estimated Bearing
Winegrape Acres
Average Winegrape
Yield
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #1:How did the 2013 crush size up?
Answer:Clearly above recent
averages, both in total production and in
per acre yields
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #2:What are the Central Coast grape
pricing trends?
Allied Grape Growers, 2014. All rights reserved.
For Categories >3,000 Tons 2011 2012 2013 Recent Trend
District 7 Chardonnay 1,068$ 1,141$ 1,186$ UpDistrict 8 Chardonnay 1,202$ 1,286$ 1,231$ Mixed/FlatDistrict 7 Gewurztraminer 901$ 1,108$ 890$ Mixed/Flat
District 7 Pinot Gris 980$ 1,036$ 1,122$ UpDistrict 8 Pinot Gris 1,011$ 1,203$ 1,227$ UpDistrict 7 Riesling 947$ 924$ 914$ Down Slightly
District 7 Sauvignon Blanc 933$ 966$ 1,048$ UpDistrict 8 Sauvignon Blanc 967$ 1,077$ 1,146$ Up
White Winegrape Pricing Trends - Districts 7 & 8 (Table 10 Avg.)
Answering Some Key Industry QuestionsWhat are the Central Coast grape pricing trends?
Allied Grape Growers, 2014. All rights reserved.
For Categories >3,000 Tons 2011 2012 2013 Recent Trend
District 7 Cabernet Sauvignon 931$ 1,030$ 1,058$ UpDistrict 8 Cabernet Sauvignon 1,072$ 1,278$ 1,358$ UpDsitrict 8 Grenache 1,367$ 1,416$ 1,548$ Up
District 7 Merlot 939$ 989$ 1,016$ UpDistrict 8 Merlot 862$ 1,080$ 1,029$ Mixed/FlatDistrict 8 Petite Sirah 1,088$ 1,257$ 1,269$ Up
District 7 Pinot Noir 1,535$ 1,609$ 1,692$ UpDistrict 8 Pinot Noir 2,709$ 2,647$ 2,629$ Down Slightly
District 7 Syrah 907$ 968$ 1,019$ UpDsitrict 8 Syrah 1,144$ 1,243$ 1,250$ UpDistrict 8 Zinfandel 1,154$ 1,354$ 1,273$ Mixed/Flat
Red Winegrape Pricing Trends - Districts 7 & 8 (Table 10 Avg.)
Answering Some Key Industry QuestionsWhat are the Central Coast grape pricing trends?
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #2:What are the Central Coast grape
pricing trends?
Answer:Mostly positive in recent years,
with minor categorical weaknesses
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #3:How many acres do we really
have?
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Bearing Non-Bearing TotalState Reported 459,187 19,222 478,409 State Estimated 508,000 38,000 546,000 DPR Permitted N/A N/A 608,000 AGG Estimated 530,000 60,000 590,000
2014 AGG Estimate 555,000 90,000 645,000
2012 Acreage Data Comparison
Answering Some Key Industry QuestionsHow many acres do we really have?
Notes: 2013 state data will be released in April of 2014.DPR data may include raisin variety acreage classified
as wine.
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry QuestionsHow many acres do we really have?
- 5,000
10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000
Three YearsAgo
Two YearsAgo
One Year Ago Currently
Range of Potential California Winegrape Acres Planted (Current Year 2013/2014)
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #3:How many acres do we really
have?Answer:
Much more than the state has historically reported or estimated
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #4:Are Central Coast acres under-
reported?
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District 6• Albarino• Gewurztraminer• Gruner Veltliner• Malbec
District 7• Primitivo
Are Central Coast acres under-reported?
Answering Some Key Industry Questions
Varieties that are under-reported in the Central Coast(for > 50 acres)
Allied Grape Growers, 2014. All rights reserved.
Are Central Coast acres under-reported?
Answering Some Key Industry Questions
Following analysis of Central Coast Acreage and Production, it was concluded that the combined
District 7 & 8 reported bearing acreage is only off of actual by less than 1%.
Allied Grape Growers, 2014. All rights reserved.
Are Central Coast acres under-reported?
Answering Some Key Industry Questions
An estimate of non-bearing acres from 2012
DPR/State Reported Total 105,275 Adjusted Bearing 91,506 Estimated Non-Bearing 13,769
2012 Acreage Data ComparisonCentral Coast, Districts 7 & 8
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #4:Are Central Coast bearing acres
under-reported?
Answer:No, the Grape Acreage Report is
capturing nearly all bearing winegrape acres.
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #5:What are growers planting today?
(other than almonds)
Allied Grape Growers, 2014. All rights reserved.
29% White
71% Red
Other Reds Include:GrenacheCab Franc
SyrahMalbecTannat
Other Whites Include:GewurztraminerRieslingViognierOther florals
What are growers planting today?
Answering Some Key Industry Questions
Cabernet Sauvingon
29.4%
Pinot Noir12.5%
Zin/Primitivo10%
Petite Sirah5%
Merlot3.5%
Rubired2.7%
Petite Verdot2%
Other Red6%
Other White2%
Sauvignon Blanc<1%
Muscat Alex/Canelli
1.4%
French Colombard6%
Pinot Grigio5%
Chardonnay13.7%
2013 Winegrape Vines Sold by California Nurseries
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #5:What are growers planting today?
(other than almonds)
Answer:Cabernet Sauvignon….
and a few other varieties
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #6:What about the drought?
Allied Grape Growers, 2014. All rights reserved.
What about the drought?
Answering Some Key Industry Questions
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #6:What about the drought?
Answer:The drought will undoubtedly
cause concern and loss for California winegrape growers.
Production will likely be negatively impacted.
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #7:What are the regional planting
trends?
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry QuestionsWhat are the regional planting trends?
Regional Allocation of Major Winegrape Vines Sold, 2013
High End
Mid Range
Value
FrenchColombard
Muscats
PinotGrigio
Chardonnay
Zinfandel/Primitivo
PinotNoir
Merlot
CabernetSauvignon
Petite Sirah
A high percentage of the “Value” plantings are in Lodi
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry QuestionsWhat are the regional planting trends?
Varieties charted are Chardonnay, Cabernet Sauvignon, Merlot, Pinot Noir and Zinfandel.
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
2010 2011 2012 2013
Breakdown of vines sold by categoryFive major varieties, 2010-2013
High & Mid
Value
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #7:What are the regional planting
trends?
Answer:Coastal planting of major varietals has increased
substantially. Interior planting has shifted north to Lodi.
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #8:Are we headed for surplus,
balance or shortage?
Allied Grape Growers, 2014. All rights reserved.
2009 3,703,031 495,000 7.48
2010 3,588,985 505,000 7.11
2011 3,342,689 515,000 6.49
2012 4,018,237 530,000 7.58
2013 4,244,891 545,000 7.79
2014 3,774,000 555,000 6.80
2015 4,132,500 570,000 7.25
2016 4,343,500 595,000 7.30
2017 4,581,250 625,000 7.33
Average per acre yield from 2009-2013: 7.29
Crop Year
Winegrape Tons Crushed or Projected
AGG Estimated Bearing
Winegrape Acres
Average Winegrape
Yield
Are we headed for surplus, balance or shortage?
Answering Some Key Industry Questions
Average Statewide Yield = 7.29 TPA
Assumes no escalation in the current rate of annual vineyard removals…….(<2% per year).
Allied Grape Growers, 2014. All rights reserved.
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2009 2010 2011 2012 2013 2014Est.
2015Est.
2016Est.
2017Est.
California Wine Shipments and Grape Production (for wine only)2009-2013 with estimates and projections thru 2017
Wine Shipments Grapes Crushed for Wine
2013 Wine Shipments estimated by AGG based on data obtained via theThe Gomberg Fredrikson Report, 01/2014
Millionsof Tons
Forecast shows production growth outpacing shipments in the near future
Are we headed for surplus, balance or shortage?
Answering Some Key Industry Questions
Allied Grape Growers, 2014. All rights reserved.
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17
Estimated California Bearing Winegrape AcresFrom 1990 with projections
Forecast shows acreage growth beginning to outpace the trendline by
2017.
Are we headed for surplus, balance or shortage?
Answering Some Key Industry Questions
Allied Grape Growers, 2014. All rights reserved.
Answering Some Key Industry Questions
Question #8:Are we headed for surplus,
balance or shortage?
Answer:We are not forecasting a shortage
in the foreseeable future
Allied Grape Growers, 2014. All rights reserved.
Questions?
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