Smoke Exposure Impact on Winegrape Contracts Detailed in New Report

Brian German Industry, Nuts & Grapes

Smoke exposure has become even more of an issue for producers in recent years, with record-setting wildfires occurring more frequently. A recent report details some of the contract issues in the winegrape industry created by wildfire smoke concerns. The report was commissioned by Allied Grape Growers (AGG) and the California Association of Winegrape Growers. The report includes 2020 transaction information within the winegrape industry, providing insight on how wildfire smoke has impacted rejections.

smoke exposure
Vineyard near Sonoma in the Napa Valley region, California.
Photo by Len Wilcox

“This report that we commissioned was a report that covered the entire industry and had many sources that contributed to the information that was surfaced in the report,” said AGG President Jeff Bitter. “This year was a situation where the smoke damage and exposure were statewide for the most part. There were very few areas of the state that weren’t affected in some way, shape, or form by the wildfires last year. So, it became a pretty comprehensive industry issue for us.”

Industry sources have indicated that between 165,000 and 325,000 tons of winegrapes were left unharvested in relation to smoke exposure. The estimated value of the unharvested winegrapes was $106 million. Prepared by Downey Brand, LLP, the report analyzes the rejection of winegrapes under contract and the various justifications used. It also details applicable law and how growers might be able to better protect themselves.

“What we’ve found over the last few years is that most of the winegrape contracts that were in place were not equipped to address smoke exposure as an issue,” Bitter noted. “When we had issues with smoke exposure you’ve got two parties that both have perhaps some preconceived ideas about what should happen during a smoke event, or after a smoke event. Those don’t always align, so you end up with conflict that’s not easily resolved by verbiage in the contract.”

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Brian German

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Ag News Director, AgNet West