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North Bay Business Journal

Thursday, November 29, 2012, 6:10 pm

Report: Wine puts $13B into Napa economy

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    ST. HELENA — The total economic impact of Napa County’s grape and wine business last year was $13.3 billion inside the county line, $25.9 billion in California and more than $50 billion in the U.S., according to a study released today by a local trade group.

    These estimated effects on the local, state and national economies resulted not only from production of wine from the county’s 789 wineries to domestic and foreign markets but also sales of grapes from the county’s 43,500 acres of vines, distribution and retail markups on that wine, sales of suppliers to the industry, tourist spending but also wages at these various businesses, according to the 19-page study by Napa-based Stonebridge Research for Napa Valley Vintners.

    “This is the most comprehensive examination of our wine industry’s economic impact to date, giving us a more detailed look from a multitude of resources, from one-on-one interviews with wine and wine-related businesses to local, state and federal reporting agencies,” said Linda Reiff, executive director for the 430-winery-member trade marketing and advocacy group. ”The Napa wine industry is healthy and thriving, fueling our local and national economies even in these uncertain times.”

    The new report found an economic impact from the industry more than double that of the trade group’s 2008 report, partly because it didn’t account for “many millions of cases” of wine made from grapes from outside the county but crushed and bottled at its wineries, according to report author Barbara Insel. There also have been significant changes in supplier operations, such as moving to lower-cost surrounding counties and selling more locally produced or finished products over imports, she noted.

    Largely from 2011 figures and data, the report presented these sizable estimates:

    • In 2011, the equivalent of 49.7 million 9-liter cases of wine were bottled in Napa County in 2011 and 53.6 million were shipped, up from 47.4 million and 52.1 million in 2010, based on data from the U.S. Tax & Trade Bureau. More was shipped than bottled those years likely because wineries continued to work through inventory that accumulated as sales slowed dramatically late 2008 through 2009, according to Ms. Insel.
    • Wines bearing the Napa Valley appellation name on the label accounted for 3 percent of wine produced in California, but all wine bottled in the county made up one-fifth of state production.
    • Winery sales, including exports, through brokers, distributors and retailers were $3.8 billion. Sales directly to consumers and trade accounts were $744.5 million.
    • Employment in the wine and grape industries plus related businesses accounted for the equivalent of 46,000 full-time Napa County jobs and payroll of $2.07 billion.
    • Wine-related businesses and property paid $1.3 billion in local, state and federal taxes.
    • The wine industry in the county contributed $84 million in in-kind and cash to charity.
    • Tourism spending connected to the local wine business accounted for $1.05 billion.

    “The total number of visits to Napa Valley wineries has recovered to somewhat above its pre-recession levels, based on interviews with a large cross section of Napa Valley’s wineries, although visits seem concentrated among wineries with stronger followings and brands,” Ms. Insel wrote in the report.

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