Grape Crush Report reveals decade's lightest wine crop

By Caleb Hampton 

California winegrape growers last year harvested the smallest crop of any year within the past decade, according to the California Department of Food and Agriculture’s Preliminary Grape Crush Report, an annual benchmark for the winegrape and bulk wine sector.

The overall 2022 winegrape crush of 3.35 million tons was the lightest since 2011, the Feb. 10 report said.

Because of weather and other factors, wine sector experts had forecast a light harvest. However, the crush “was even lighter than anticipated, further emphasizing the impact of drought conditions, a severe frost, and ongoing vineyard removals particularly in the Central Valley,” Greg Livengood, president of Ciatti Company, said in a statement released by the global wine and grape brokerage.

The sector’s third consecutive “short” year, or small harvest, is not altogether bad news for winegrape growers or bulk wine sellers. With demand for wine stagnating over the past couple years, the smaller-than-average yields have kept inventory low and prices high.

“It’s probably good that we didn’t have that large of a crop because I think that would have affected the supply and demand balance,” said Glenn Proctor, owner and vintner of Puccioni Vineyards and partner at Ciatti Company. “We’ve kind of backed into a balanced situation.”

In 2022, California winegrape prices were on average their highest on record. However, leaders in the sector pointed out that the strong pricing has not translated into a windfall for vineyards.

“The challenge, if you’re a grower,” Proctor said, “is you get paid in dollars per ton. If my tonnage is down, that means my gross is potentially less.” Meanwhile, the materials, labor and other input costs for winegrape production increased for many growers, narrowing their margins.

“It’s been difficult to pass along some of the costs that they’re seeing,” Proctor said. “I think it makes the overall market opportunity potentially smaller and more competitive.”

Beyond the market dynamics, the 150-page grape crush report revealed notable trends in California’s winegrape sector.

For the first time, cabernet sauvignon surpassed chardonnay in total tonnage, making up 15.4% of all the grapes harvested, with chardonnay trailing at 14.4%.

Red wine varieties made up the largest share of all grapes crushed, coming in at 1.89 million tons, down 7.2% from 2021. White wine varieties totaled 1.46 million tons, down 8.6% from 2021.

Across all varieties, the average price was $910.80 per ton, up 5.7% from 2021. Red wine varieties went for an average of $1,150.58, up 7.2%, while white varieties fetched $682.07, up 1%. All of those figures are record highs.

Napa County, or District 4 in the report, had the highest pricing at $6,847.19 per ton, an increase of 12.2% from 2021. Prices for winegrapes from District 3, Sonoma and Marin counties, were also up, selling for an average of $2,858.39 per ton.

Statewide, cabernet sauvignon pricing rose by 13.8% to $1,892.40, while chardonnay prices went up by 3.9% to $1,014.63. The average price of Napa County cabernet sauvignon grapes hit a new record of $8,947 per ton.

Despite the low yields, grower revenue for North Coast vineyards in Napa, Sonoma, Mendocino and Lake counties reach $1.39 billion, the region’s sixth-highest total on record. Napa County led the pack, bringing in more than $860 million, an increase in revenue of nearly 20% compared to the prior year.

Lake County produced 21,214 tons of cabernet sauvignon, a historic figure for the county, while still seeing higher prices than the prior year. Mendocino County increased its tonnage by 30%, while seeing slightly lower pricing. Experts attributed the increased production in those counties to new vineyards coming online.

On the Central Coast, the overall tonnage was down by 130,000 tons, with prices trending upwards for bulk wine, especially cabernet sauvignon from Paso Robles.

Meanwhile, winegrape production in the Central Valley declined for a sixth consecutive year. In that region, “the continuing trend of an annual lighter crop appears to be due mostly to drought conditions and ongoing vineyard pullouts,” Johnny Leonardo, partner at Ciatti Company, said in a statement.

With the release of grape crush data for 2022, those in the sector are waiting to see if the report spurs market activity.

“It will be interesting to see how the market moves going forward,” Proctor said. “The belief on some fronts is that we’re going to see some renewed market activity because the crush was lighter than everybody thought. I think that’s a possibility. But I also think a lot of the reason we’re seeing some of this hesitant activity on the market is because of the economy and concerns about where it is going to take us in the future.”

He added, “Buyers are somewhat reluctant to make commitments. They don’t want to have more supply than they need.”

(Caleb Hampton is an assistant editor of Ag Alert. He may be contacted at champton@cfbf.com.)