California Crop Forecast: 4 Million Tons
Allied Grape Growers president says tonnage will be up from 2015, shy of highs from 2012-13

Allied Grape Growers held events in both Fresno and Santa Rosa to accommodate the group’s members in both regions. Wines & Vines attended the meeting in Santa Rosa, in the North Coast, where Allied Grape Growers had roughly 1,500 acres under contract in 2010 and represents more than 2,500 acres today.
This growth has led the organization to add another grower from the North Coast to its seven-member board, and Brian Capp of Capp Bros. Vineyard Management in Napa, Calif., was elected to that position.
Unlike the 2015 meeting, this gathering was mostly upbeat. “Some years I would rather be having a tooth pulled than face you with the news,” said president and CEO Nat DiBuduo. “Last year was one of those years.”
Fortunately, things are going well for the grape marketing cooperative, which has nearly 500 members including 125 member-growers in the North Coast, 50 in Lodi/Clarksburg and Contra Costa County and 300 in California’s interior valleys.
Allied Grape Growers has members from southern Kern County up to Clear Lake in Lake County. So far this year, grapes have been contracted from $275 per ton to $7,500 per ton or higher, depending on location and variety. “We provide wine grapes for some of the best wines that come out of California and to wines that sell for under $10 per bottle,” noted DiBuduo.
He disclosed that the co-op’s revenue for 2015 was more than $70 million.
In Lodi, the co-op has experienced more than 37% growth in wine grapes since 2010. There were fewer growers at the co-op’s Central San Joaquin Valley meeting; many pulled out their Thompson Seedless vines or sold their ranches, but wine grape acreage has still grown 50%.
DiBuduo admitted he received a lot of criticism at the Unified Wine & Grape Symposium in Sacramento, Calif., in January when he suggested growers needed to pull out more wine grape acres. “No wine grape grower should be providing grapes below their cost of production. You are in the business to survive and thrive. So if I can save any grower from going bankrupt by suggesting alternatives or getting better pricing, I will."
He summarized the overall market for California wine grapes:
“North Coast is the shining star in this industry. The current demand is outpacing the supply. There are strong prices and terms. Some wineries are offering planting contracts for the first time in years.”
Central Coast prices appear to be strengthening. The supply is limited there. “We see some contracts for Pinot Noir and Chardonnay.”
He said that, while it’s early in the season, Lodi growers are enjoying strong sales, and most grapes are finding homes. There is a limited supply available of red Zinfandel and some other varieties.
However, in the central San Joaquin Valley, some varieties like Muscat, Ruby Cabernet and white Zinfandel continue to be challenged. “We have plenty of those for sale,” he said. “The good news is that in August of last year, we had over 20% left to sell. This year we have less than 10% left.”
A push for ‘premiumization’
One of DiBuduo’s key messages was that growers must continue to increase the quality of their fruit.
“The key word we’ve seen over the last few years was ‘sustainability,’” he noted. “Now there is a new one: ‘premiumization.’ That is the new term in all grape sales in California, regardless of whether we’re talking about Napa and Sonoma or the Central San Joaquin Valley. In short, it means ‘quality.’ It affects your crop sales and your income.”
He observed that over the years, Napa has proven that quality and branding gets higher prices. “This has been spreading to the North Coast the past few years, but especially this year. It didn’t happen overnight: It came through consistent quality of fruit and wine and marketing the Napa brand.”
He declared that “premiumization” is catching on. “A few other areas are starting to be recognized for their quality grapes and wines, including the North Coast and its various AVAs, Chardonnay and Pinot Noir from Monterey County and the Santa Lucia Highlands AVA, Santa Barbara County, Central Coast, Paso Robles and its various AVAs, as well as Lodi and Clarksburg.”
But, he added, “We need to work with growers in Lodi to help increase the quality to step up the price point. They are in the sweet spot of desirable pricing and demand.”
He reports that some wineries are favoring new vineyards that are utilizing “premiumization” methods instead of old established vineyards. DiBuduo encouraged the members to strive for “premiumization,” regardless where they farmed. “There is an upgrade quality at all price points.”
He also suggested that they participate actively in local growers’ organizations. “Work together to develop a marketing plan and AVA brand.”
DiBuduo encouraged growers to donate to wine grape research organizations like the National Grape & Wine Initiative, American Vineyard Foundation and the Department of Enology & Viticulture at the University of California, Davis.
Growing competition
DiBuduo reminded growers of another reason to produce better grapes: competition from overseas. “Wines sell from $3 to hundreds of dollars per bottle. Bulk wine varies from $1 to $25 per gallon, depending on premium. Don’t be fooled that we aren’t selling grapes against imports on a daily basis. Don’t be fooled that bottled wine isn’t coming in and competing against higher priced bottled California wine as well.”
He related that he recently tried to sell Chardonnay to a major winery. “Their response was, ‘I can get bulk Chardonnay for $1.25 per gallon, so I don’t need your grapes.’ That’s cheaper than we can even produce it. My response to that was, ‘But it isn’t quality California wine. What happens when you can’t buy it from that source anymore? Those grapes may not be available down the line.’”
Grower ‘threats’
DiBuduo also mentioned other threats to growers:
• The new minimum wage law will affect not only minimum wage earners but workers up the ladder as well.
• AB 1513, the piece rate law for non-productive time going back from July 2012 to December 2015, then January 2016 forward. AB 1513 provides a safe harbor statue that was delayed until July 28, 2016, due to a lawsuit currently being challenged by Nisei Farmers League. It may be delayed again, but it is not going away.
• Agriculture overtime exception legislation has been reintroduced for working more than 40 hours per week or eight hours per day.
• Labor shortages. “People can’t find workers.”
• Powdery mildew. “A weather pattern that has promoted prime conditions.”
• Vine mealybug
• Red blotch
DiBuduo, however, painted a positive picture overall. “Wine sales were up 1% instead of the 3% of the past, but 1% is better than no growth.”
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