201 Alameda Del Prado, #101, Novato, CA, United States of America, 94949
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Ciatti California Market Report, March 2022
As the first quarter of 2022 draws to a close, California’s bulk wine and grape markets are active, in some areas and on some varieties more active at this point than they have been for a few years. Last month’s 2021 grape crush report confirmed, at 3.61 million tons, a second-successive short crop, while the ongoing dry winter in California is raising the prospect of a third. Set against this, wine sales at US retail continue to fall back as pandemic pantrystocking recedes into the past and inflationary pressure is going to be felt by all businesses and individuals this year.
The crush report revealed a state-wide average tonnage price of $884/ton in 2021, well up from 2020’s $680/ton. But from an historical perspective the 2020 price was anomalous, as smoke exposure concerns led to downward adjustments. The 2021 price of $884/ton could be said to mark a return to normal pricing, in line with 2019’s $827/ton and 2018’s $856/ton, and was a product of three factors: Reduced wine supply from the 2020 vintage and smoke exposure perceptions around it; a spike in retail demand lasting for at least 15 months from March 2020 onwards; the expectation of another shorter crop in 2021 (which ultimately proved correct).
Crucially, only one of these three factors was down to consumer demand, and even that was a temporary spike triggered by a pandemic, a – hopefully – once-acentury phenomenon. We are now seeing 2021 bulk wines being put back onto the Central Valley’s market, indicative of sales projections being revised downward post-spike, as wineries – seeking to cover rising input costs – increase shelf prices amid the wider inflationary environment. The portents for consumer confidence this year are not good: the US 12-month inflation rate reached 7.5% in January, the highest since 1982, and the prospect of it falling back quickly has been diminished by the outbreak of the Ukraine-Russia conflict. Furthermore, the crush report showed that 2021 marked the fifth year in a row in which grape volumes from the southern San Joaquin Valley declined – the lack of water is partly responsible but vines have been also removed. The Californian wine industry has a profitability problem in some growing areas and a sales problem both in the short term (a tough 2022 ahead, economically) and long term (the average US wine drinker is growing older). We continue to feel that if the last three crops had been more average-sized the bulk wine and grape markets would not be in the – relatively – balanced position they are today. Even with that relative balance, we are seeing a few Lodi growers replacing their vines with almonds.
Meanwhile, the crush report showed the Central Coast and Lodi having goodsized grape crops, the latter gaining over 100,000 tons versus 2020, partially attributable not to new plantings but conversions to high-efficiency quad or double canopy vineyards. Such efficiencies are likely to be one of the ways wine grape-growing in California can be made more sustainable for the longer term.
The next three quarters at least are going to be challenging but, as always, opportunities will develop. Ciatti can draw on its decades of experience to help you find and harness them – don’t hesitate to get in touch. Read on for more information on the bulk wine and grape markets, and stay safe.
About
With 8 offices world wide, Ciatti serves our clients with the most up-to-date and accurate market information available. Please contact us with any questions. We are truly at your service.
Greg Livengood
President, Partner and Broker
Greg joined Ciatti in 1994 and became a partner in 1997. Greg has used his degree in International Relations to build Ciatti into the world recognized leader in the alcohol beverage business. Greg is currently the President and CEO of the company and drives the international group.
Email:greg@ciatti.com
Steve Dorfman
Partner and Broker
Steve Dorfman joined Ciatti in 2007 after working with the Brown-Forman Corporation, Fetzer Vineyards, Sonoma-Cutrer Vineyards and Bolla Wine brands for 24 years. His primary responsibilities are wine and grape sales within California, and the supply demands of markets throughout Europe, South Africa and Australia.
Email:steve@ciatti.com
John Ciatti
John White
Partner and Broker
Ciatti has a long history of seeking to provide clients with a well rounded team of brokers whose experience in the industry cover the breadth of the business. John joined the company in 2003 after working as a Winemaker for several of California's major producers for 20 years. John's emphasis is maintaining relationships with California wineries ranging from the largest to the smallest. John has focused on all aspects of growth within the business, from long-term custom crush contracts to spot bulk wine and grape sales. His speciatly is the sourcing and selling of premium varietal lots from the coastal and interior regions of California.
Email:johnw@ciatti.com
Chris Welch
Partner and Broker
Chris Welch joined Ciatti in 1994, and began brokering bulk wine and grapes in 2003 and became a partner in company in 2007. The premium and super premium segment of the California wine industry are the breeding grounds of innovation and where Chris truly excels. His consistent approach helps small and medium size wineries and negotiants achieve the innovation and growth they seek. Chris also works very closely with the Oregon Wine Industry.
Email:chris@ciatti.com
Glenn Proctor
Partner and Broker
Glenn Proctor joined Ciatti in 2003 and became a partner in 2007. Glenn advises wineries on supply positioning and works closely with growers and wineries in marketing their grapes and wine. He specializes in spot and contract bulk wine and grapes sales from all regions of California. He has over 23 years of experience in wine supply strategy, wine-grape quality improvement, brand strategy, and business development. Glenn was previously the Vice President of Winegrowing for Diageo Chateau and Estate Wines, and before that was a Director at Benziger/Glen Ellen Winery during its rapid growth in the early 1990's.
Email:glenn@ciatti.com
Broker
Johnny Leonardo joined Ciatti in 2004 as a broker and knows that surviving in a dynamic wine industry requires one to be a Jack-of-all-Trades. He has experience in all aspects of winery and vineyard operation, from the field to the street. Johnny has developed and managed vineyards, and worked in wine sales and marketing.
Email:johnny@ciatti.com
Andy Bivona
Broker
Andy joined Ciatti as a broker in 1996. His areas of expertise and responsibility include grape and fruit concentrates, beverage and industrial alcohol, fruit alcohol and brandy, and food specialty products. Andy's knowledge of these products has allowed him to branch out and work throughout various parts of the world including Mexico, South America and Europe. Andy remains a wealth of knowledge and offers a creative approach to all endeavors.
Email:abivona@hvc.rr.com
Todd Azevedo
Broker
Todd Azevedo joined Ciatti in 2004 after completing his Agricultural Finance degree from Cal Poly San Luis Obispo. Although Todd brokers wine, grapes, and wine products throughout the state of California, Todd's focus is on the California Central Coast.
Email:todd@ciatti.com
Mark Ishimaru
Customer Account Representative - North America
Joined Ciatti in 2011.
Email: mark@ciatti.com
Molly Richardson
Customer Account Representation - Grower Accounts
Joined Ciatti in 2016
Email: Molly@ciatti.com
Administrative/Accounting Assistant
Joined Ciatti in 2000.
Email:alette@ciatti.com
Michael FungCustomer Account Representative - Sample Room
Joined Ciatti in 2013.
Email: michael@ciatti.com
Contact
Contact List
| Title | Name | Phone | Extension | |
|---|---|---|---|---|
| Partner/Broker | John Ciatti | john@ciatti.com | 4152640762 | |
| Partner/Broker | Steve Dorfman | steve@ciatti.com | 7073213843 | |
| Partner/Broker | Greg Livengood | greg@ciatti.com | 4154975032 | |
| Partner/Broker | Glenn Proctor | glenn@ciatti.com | 7073370609 | |
| Partner/Broker | Chris Welch | chris@ciatti.com | 4152988316 | |
| Partner/Broker | John White | johnw@ciatti.com | 4152500685 | |
| Broker | Todd Azevedo | todd@ciatti.com | 4152656943 | |
| Broker | Johnny Leonardo | johnny@ciatti.com | 4157174438 | |
| Broker | Dennis Schrapp | dennis@ciatticanada.com | 9059338855 |
Location List
| Locations | Address | State | Country | Zip Code |
|---|---|---|---|---|
| CIATTI Global Wine & Grape Brokers | 201 Alameda Del Prado, #101, Novato | CA | United States of America | 94949 |
List of Locations
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