Witness the Best “Good News” Day for Wine in Months

Up chartAmong the things I do every morning after the coffee is brewed is sit down and look through the various emails I receive the deliver aggregated wine news. Today, I opened the Wine Business Monthly Daily News Links email and saw these headlines:

Wine Demand Outstripping Supply

Forecast: Wine, grape prices to rise in 2012

Experts predict rebound in wine prices, plantings

2011 a vintage year for sales of California wine

I then moved on to Wine Industry Insight's News Fetch for the day and saw this:

Short California 2011 Winecrop Spurs Grower Prices

Collectively, these stories amount to the most good news for the California wine industry in a single day that I've seen in probably more than year. What all this optimism points to is a growing recognition, boosted by statistics, that a difficult economy is recovering and that the wine industry in particular is helping to lead the charge.

The really good news here, that results from a variety of factors, is that California's grape growers appear to be in store for an increase in prices they will get for their grapes along with an easier time finding contracts for their grapes. Two short harvests in a row and increase demand for wine is working its magic.

Add to all this the fact that Wines & Vines, via its Data Center, has been showing all year long an increase in on-premise sales of wine in 2011 over 2010 sales, a significant increase in Direct-to-Consumer shipments from wineries in 2011 over 2010, and an increase throughout 2011 in wine industry job offers over job offers witnessed in 2010.

The uptick in the wine industry sales and general health of the wine industry mimicks that we see in other luxury goods markets that we've witnessed throughout 2011. What is really necessary now and what would truly kick the wine industry and its surrounding service providers and vendors is an uptick in wine sales among the middle class. This of course would indicate a stronger recover at least in the Jobs Market, if not in the housing sector. This is the sort of thing I say prayers about when I lay my head down at night.

Today's news gives me the impression that someone might be listening.


2 Responses

  1. Bubba - January 26, 2012

    Good news for anyone involved in growing wine brands. Not quoting exact figures, but USA consumes about 9 liters per capita. We are now the top consumers globally, but per capita, that number is 1/3 of mature domestic markets e.g France, Italy, Argentina, where per capita is in decline. We are a growth market for “artisinal” product. Forget Asia — hey have a long ways to go before folks like Tom et al. have anything intelligent to day about them. Quality wine in the USA is still a new category, which is maybe more interesting than our true heritage (besides spirits), beer, which is undergoing another change in consumer preference — not growth, but conversion from mature brands to craft, local etc.

  2. David - January 29, 2012

    I wish I could be so optimistic. A lot of the California grapes are being made into wine that is being sold at low to no margin to any host of flash sites, discount retailers, etc.. Just to move through the excess of fruit and bulk wine.
    Still a couple years to go before wineries have enough margin to pay more for grapes.
    When you see headlines about retail discounts going away and flash sites closing then maybe higher fruit prices are around the corner.

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