California wine prices may drop to lowest in 20 years

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California wine prices may drop to lowest in 20 years

Сообщение ImUser » Ср фев 19, 2020 1:50 am

Good news for wine drinkers, bad news for grape growers. The price of wine is at an all-time low because of an abundance of grapes, according to a new report from the Silicon Valley Bank Financial Group.

The State of U.S. Wine Industry 2020 report said wine prices could reach the lowest in 20 years. Some are calling it good news for wine drinkers.

California wine prices may drop to lowest in 20 years

“That's always good news to us -- lower prices on alcohol, yay,” said Priscilla Kumar, who was wine tasting in Lodi on Monday.

The San Joaquin County Farm Bureau said it's not good news for everyone, especially growers.

Growers in Northern California began planting thousands of acres of new vines in 2016 with bountiful harvests of grapes, but the surplus of grapes goes to waste.

The farm bureau said some growers are choosing to leave grapes on the vine because it would cost more to produce.

“Wine grapes being left in the field is a pretty sad thing," said San Joaquin County Farm Bureau President Bruce Blodgett."A lot of money being left on each one of those bundles on the vines looks like dollar signs because that is what it meant to those landowners.”

According to the report, the oversupply of grapes isn't a reflection of the quality of the wine, but that the wine industry is "increasingly missing the mark on consumer expectations."

"Our current oversupply in California and Washington isn’t due to speculative overplanting. It’s due to the wine industry’s growing miss in not providing consumers what they want," the report outlines. "That’s not an adverse statement about the quality of what our industry produces. We’ve never made better wine. But based on the industry’s current results, making great wine isn’t good enough for the consumer today."

Speaking with CNN, the author of the annual report Rob McMillan said the larger millennial population has not yet embraced wine, which is the wine industry's largest growth opportunity.

"The industry should rightly be concerned," McMillan said. "We aren't engaging with the millennial consumer, and boomers who have driven wine sales for the last 30 years won't live forever."

He thinks that improved value on wine could lead to millennials becoming "more consistent wine buyers."

"Today, the wine supply chain is stuffed," McMillan wrote. "This oversupply, coupled with eroding consumer demand, can only lead to discounting of finished wine, bulk wine and grapes. U.S. wine consumers will discover unprecedented retail value in 2020 and should buy up."

The cheaper prices may even last up to three years.

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