Napa, Sonoma cabernet sauvignon winegrape pricing pushes North Coast to new record
While North Coast winegrape tonnage last year came in slightly below average, the value of the region’s 2016 crop hit a new record of $1.45 billion, getting a big boost from double-digit price increases in cabernet sauvignon grapes from Napa and Sonoma counties, according to figures released Friday.
Tons crushed from Sonoma, Napa, Mendocino and Lake counties last year were nearly 491,000 tons, up 21.9 percent from 2015 but down nearly 4 percent from the five-year average, according to Business Journal analysis of data from the California Grape Crush Report from the U.S. Department of Agriculture. That’s the equivalent of 6 million more standard 9-liter cases of wine, at 165 gallons of wine per ton and 2.4 gallons per case.
It was the fourth-largest winegrape crop for the region in more than a decade, behind those of 2012–2014. The previous North Coast record for winegrape crop value was $1.42 billion in 2014, which it was propelled by a 531,000-ton crush. The value of the crop in Napa County increased 28 percent last year to $685.6 million; in Sonoma, 28.9 percent to $566.9 million; in Mendocino, 35.9 percent, to $117.1 million; and in Lake, 23.0 percent to $75.8 million.
The annual crush report is the first official look at the scale and value of last year’s crop and is closely watched in the wine business as a benchmark for grape and bulk-wine sales. And what it has to say about supply and pricing is startling, market watchers said.
The California winegrape crush last year weighed in at 4.00 million tons, making it the state’s third-largest behind the 4.02 million tons of 2012 and 4.25 million of 2013. The statewide weighted-average price per ton reached a record $789, up 14.0 percent from 2015 and 4.2 percent above the five-year average.
NORTH COAST IS ‘SUPPLY-CONSTRAINED’
Put simply, it’s a seller’s market in the North Coast. Demand for many of the high-end grapes grown in the North Coast and other prime winegrowing regions along the California coast is higher than what has come off the vines in the past two years, and maybe even if there’s a good-sized crop this coming harvest, said Brian Clements, vice president and partner for Novato-based Turrentine Brokerage, which matches sellers and buyers of grapes and bulk wine.
“The North Coast is very much supply-constrained,” Clements said. “There are not as many grapes available as one would think, and the price is high.”
NEW HIGHS FOR NORTH COAST PRICING
Average prices for all winegrape varieties Napa and Sonoma counties jumped by 8.5 percent and 6.2 percent last year to new highs of $4,678 and $2,561 a ton, respectively. Napa and Sonoma prices were nearly 17 percent and over 10 percent higher than the counties’ five-year averages.
The average pricing for Mendocino and Lake county grapes last year rose 4.5 percent and 1.2 percent to $1,660 and $1,517 a ton. And those prices are 3.6 percent and 9.8 percent above the county five-year averages.
Sonoma and Napa counties tonnage weighed in at 221,400 and 146,600 tons, respectively, up 21.4 percent and 18.0 percent from 2015, when weather dampened tonnage by more than a quarter from the bumper crops of 2012–2014. Yet Sonoma and Napa tonnage last year still was 7.5 percent and 8.8 percent below their five-year averages.