California vintners eye year-end sales to gauge 2021 grape, bulk wine needs

The fourth quarter of the year typically is a make-or-break time for North Coast vintners in bottle sales.

But this anything-but-typical year of pandemic and wildfire has challenged winery planning for 2021.

When sales for the year wrap, a key question that wineries say they will be looking at is how much consumer demand there is for more wine and where any needed additional wine will come from.

“Last year, it was darn difficult to sell anything as grapes, and when the smoke hit it was darn near impossible,” said Glenn Proctor, a partner with San Rafael-based global grape and bulk-wine brokerage Ciatti Co. “I think we will see more fruit sold in 2021, but the question is what the pricing will be, because on-premise brands are not doing well. Buyers (of grapes) are looking, but they do not have an open checkbook, and it will not be like it was three or four years ago.”

Up to 2018, North Coast growers, particularly where choice cabernet sauvignon grapes are grown, were enjoying sizable year-to-year increases in grape prices. Bulk wine most in demand was selling at prices per gallon as much as 10 times what the same varietal wines were fetching in other places of the state.

But wine sales growth overall slowed in the years since, followed by bumper crops in 2018 and 2019.

And this year, even before the massive Walbridge/Hennessey and Glass wildfires in August and September, respectively, a drier spring was expected to yield a North Coast grape crop 10% to 20% smaller than previous years.

Sonoma County Winegrowers projected that 25%–30% of the county’s grapes weren’t picked this year because of smoke, and the crop beforehand was estimated to be smaller than average 180,000 tons.

Mendocino Winegrowers estimated the county’s wine grape crop was down 20%–30%. Napa County continues to assess the smoke impact, which came most intensely as the Glass Fire crossed the upper valley as the key parts of the harvest there were just getting underway.

Altogether, Ciatti Co.’s ballpark estimate for wine grapes not picked statewide because of smoke could be 300,000 tons, out of a projected total California wine grape crop this year 3 million to 3.4 million tons, which would be down roughly 12%–17% from 2019.

But demand for bulk wine to supply brands selling briskly at retail spiked at harvest time as the smaller size of the crop and potential for unpicked tonnage became known, according to Greg Livengood, a bulk wine broker for Ciatti.

The glut of 22 million gallons of California bulk wine left over from the 2018–2019 vintages was sucked up in the past six month, reducing the supply to around 8 million gallons, with a moderate fraction of that coming from the North Coast. And unsold bulk North Coast wine was selling at prices well above the state average, something not seen in almost two years.

“I look forward to 2021, because it can’t get much worse than the pandemic and the fires,” said Brian Clements, partner with Novato-based Turrentine Brokerage. “Hopefully, we will have an average to below-average crop and get rain this winter and the vaccine allows things to open up again.“

Of the fruit that Jackson Family Wines facilities accepted this year, wines made from it are still being evaluated for smoke damage, but early signs are encouraging, said Rick Tigner, CEO of the Santa Rosa-based company in an email.

“Our white wines are far less impacted and will be incredible,” he said. White wines tend to go to market in months, versus one or more years for red wines.

Chief among the vexing challenges of chemical compounds associated with wine smokiness is the bond they form with sugars in the grapes and juice. Fermentation frees those compounds in the wine, so consumers can detect them.

But Jackson isn’t trying to make up for the grapes it didn’t bring in because of smoke and other issues, Tigner said.

“Because our wineries source most, if not all, of their fruit from our estate vineyards, we won’t focus on purchasing bulk wine for our wine programs,” he said. “Ultimately, we won’t bottle anything that doesn’t meet our highest standards of quality.”

The viral pandemic has caused a bifurcation in fortunes for wine brands. The repeated closures of Wine Country tasting rooms and many restaurants through coronavirus pandemic control measures in California and key markets nationwide has hit the wine business hard.

On-premises sales of wine are projected to be down 50%–60% this year from 2019, Sonoma County-based beverage industry analyst Jon Moramarco told the Wall Street Journal.

Meanwhile, sales of wine in stores and online have been bustling.

For example, Jackson is seeing strong sales so far in the fourth quarter for its key store brands such as Kendall-Jackson, La Crema and Murphy-Goode, according to Tigner. Retail sales for the company are up 25%, offsetting losses from on-premises accounts.

“We’ve adapted our distribution strategy towards direct online sales for smaller-production wine estates that are more on-premise focused, such as Stonestreet, La Jota and Brewer-Clifton,” Tigner said.

The company has seen early signs of success from that strategy, with October sales of such high-end brands having the first month of year-over-year growth since April.

Though tasting-room business is down for the years with on-again, off-again pandemic restrictions in California, Jackson’s overall direct-to-consumer business is up 4% so far this year, Tigner said.

To support that, the company recently launched an online shopping portal for its brands,, and shifted some tasting room staff to that effort. And the company has increased its efforts with other direct-shopping portals and services, namely deliverers Drizly and Instacart and

At St. Helena-based Trinchero Family Estates, among whose 50-plus wine and spirits brands are Sutter Home, Three Thieves, Bandit and Trinchero Napa Valley, October results were light, but the quarter is expected to have “vibrant” sales, according to Tom Fantham, chief commercial officer.

That’s because another round of “pantry loading” is expected to gain momentum as more states go into another lockdown this month as COVID-19 cases rise.

Amid that, consumer trends of the “new normal” are emerging, he said.

“You have a number of consumers that are trading up in size and wanting the most value for their beverage alcohol spend,” Fantham said. “Then you also have another consumer behavior with a number of folks trading up in price. These are likely people that used to go out and spend money in restaurants regularly and are now spending more money on luxury wines they’re enjoying at home.”

The company is keeping a close eye on whether it needs to pick up shipping and logistics equipment, as delivery is expected to be more challenging as e-commerce booms in the pandemic, Fantham said.

And with consumers visiting stores less frequently, that’s causing the company to seek ways to move its store marketing into more prominent places to make the most of the fewer possible impressions.

Jeff Quackenbush covers wine, construction and real estate. Before the Business Journal, he wrote for Bay City News Service in San Francisco. He has a degree from Walla Walla University. Reach him at or 707-521-4256.

Show Comment

Our Network

The Press Democrat
Sonoma Index-Tribune
Petaluma Argus Courier
North Bay Business Journal
Sonoma Magazine
Bite Club Eats
La Prensa Sonoma
Sonoma County Gazette