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California Crushed It in 2012
- Wine Business
- Written by Fred Swan
- Sunday, 10 February 2013 20:13
2012 was a record year for California's wine grape business, according to the just-released Preliminary Grape Crush Report from the California Department of Food and Agriculture. Coming off a very diffcult 2011, growers achieved all-time highs in both total crush volume and price per ton.
The total grape crush in 2012 was 4.383 million tons. That was a 13% increase from the previous year and 1% better than the previous record year, 2005. Total crush includes both raisin and table grapes though. The 2012 California wine grape crush was 4.014 million tons, 7% greater than the wine grape crush in 2005 and 20% greater than in 2011.
The tonnage of the 2012 California wine grape crush was greater than that of 41 Nimitz-class aircraft carriers. Infographic: Fred Swan
Wine grape prices increased dramatically in 2011, due to both shortage and the depletion of previous wine inventories. The average price for wine grapes was $637 per ton, 4% higher than in 2009 (the previous record year) and 11% greater than in 2010. Despite record high volumes, prices didn't just rise again in 2012. They skyrocketed to $769 per ton, eclipsing 2011's all-time high by almost 21%.
Clearly, the increase in both tonnage and price will help growers recover some of their losses from the previous two years. But the higher grape cost will also put price pressure on the finished product. Will the 2012 vintage be introduced at markedly higher wholesale and retail prices? Or will the high volume combined with consumer price sensitivity and foreign competitors limit hikes at the cash register and squeeze wine producer profit margins? Some wineries locked in supply contracts with growers this year. Those contracts could be extremely burdensome in future years if retail prices don't rise.
Which were the leading grape varieties in the 2012 harvest? By ton, the answer isn't surprising: Chardonnay, Cabernet Sauvignon, Zinfandel and Merlot.
What were the most expensive grapes? The numbers are misleading if you don't consider the effect of high-volume plantings in low-price regions. For example, the most expensive grapes overall per ton were varieties such as Beclan, Picpoul Blanc, Early Burgundy, Ribolla Gialla, Meunier and Charbono. But these are very low-volume, boutique varieties grown in relatively high-dollar regions. The 3 total tons of Beclan sold for $2,700 each. That's twice the average price per ton for Cabernet Sauvignon which is ery expensive in places such as Napa and Sonoma but much less so in the high-volume Central Valley. Cabernet Sauvignon average $5,098 per ton in Napa County. The (very extreme) peak price there was $50,000 per ton from one grower who produced 5.2 tons of fruit.
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