The short winegrape crop in 2022 could be a good thing for the industry overall. President of Allied Grape Growers, Jeff Bitter said that demand has someone leveled off in the past couple of years. Winegrape crush numbers were surprisingly low last year, largely due to environmental complications. Although challenging for growers in the short term, the short crop helps provide more stability in the market overall.
“Unfortunately, we’ve been unable to grow our market for wine over the last few years. It’s been a very flat market overall. Some years slightly up, some years slightly down, in terms of volume,” Bitter explained. “So, considering that we came into 2020 with an acute excess of grapes and wine, these three short crops have actually helped us to come into balance and stay in balance with demand.”
LOOKING TO THE FUTURE
Some vineyards have been taken out in recent years, but not at a rate that would bring harvest levels below the four million ton average. Coming out of an oversupply of winegrapes in 2018 and 2019, there is still a risk of oversaturating the market with average crops. A few consecutive years with an average to above-average crop on the current acreage could prove challenging for the industry. “We would once again be producing too much for the market because the market has not seen growth in the last five years,” Bitter noted.
With the short winegrape crop, prices improved to $944 per ton. Although overall prices have been trending upward over the past decade, they are still not keeping pace with the cost of production. Bitter said opportunities for prices to go up are limited by the lack of market growth in terms of volume. “The price increases we’ve seen have come up against some ceilings if you will in the market, where buyers are apprehensive to pay more money for grapes based on the bottle price that they’re trying to maintain on the shelf,” said Bitter.
About the Author
