A vineyard worker

 A vineyard worker gets in a bucket of picked grapes on Oct. 11.

Not enough water and too much heat will result in a second short grape crop across California this harvest, according to forecasts by the Ciatti Brokerage Company, a global wine and grape brokerage firm. That short crop, however, may help to balance a grape market that faced excessive supply in 2018, leading growers to pull out vines to plant different varietals.

California is expected to produce 3.6 million tons of grapes this year, up slightly from the 3.4 million tons harvested in 2020, but down from the average crop of 4.1 million tons. Sonoma County, however, was forecasted to come in a little closer than normal, when compared to other North Coast wine growing regions like Lake and Mendocino counties and Napa Valley.

“The severe statewide drought has inevitably played a big part in the quick ripening: Water curtailment mandates are in place up and down the state’s rivers, and there have been drought stress issues visible on some vines, including lack of berry sizing and desiccated foliage,” according to the firm’s September edition of the monthly California Report.

Despite enormous wildfires in Central California and the Sierra Nevadas, smoke damage played less of a factor in stunted crop size this year.

“The Caldor Fire has perhaps caused some smoke exposure issues that are very limited in extent in terms of grape-growing area, so too the Dixie Fire. In many areas across the state, smoke is sometimes evident high up in the atmosphere, too distant to have much — if any — effects. Wineries remain largely unconcerned to date,” the report reads.

Drought-related water curtailments, however, resulted in water shortages that limited growers’ ability to slow quickening crops. Because of that, many red grapes, generally picked later in the harvest months, were ripe around the same time as white grapes.

According to Glenn Proctor, partner at Ciatti, 2020’s was the lightest crop seen in 10 years. However, reductions caused by adverse weather and drought began to occur at a time of supply and demand imbalance.

”In some ways the lighter crops are creating balance in supply and demand,” Proctor said.

In 2016 and 2017, wine consumption in the U.S. began to flatten, and a larger than usual crop in 2018 led to excess supply. Since then, the variables of the wildfires, extreme heat and changes in supply lines and consumer habits during the pandemic have added additional unstable variables to the wine market.

“I think the wine market in general has held up okay. But it’s definitely a challenging environment,” Proctor said.

Wineries, Proctor said, have been hesitant to buy grapes aggressively, as revenue has been affected by the pandemic. With people periodically unable or unwilling to congregate at establishments to engage in wine tastings and such activities, wineries saw a big decrease in “on-premise sales,” with a corresponding increase in “off-premise sales” — or sales from groceries stores or other markets.

Off-premise sales, which increased dramatically during the pandemic, are less lucrative for wineries, that make more money charging customers premium prices to sample fine wines in tasting rooms adjacent to scenic vineyards. Wineries being uncertain that they will be able to fetch the higher price have been less eager to buy up grape stock.

While the two short crops in a row (in addition to increased buyer hesitation over decreased on-premise sales) may help to re-establish balance between supply and demand in the grape market, Proctor said the biggest challenge in predicting the future market is water curtailment issues.

“I think our balance at this time is tenuous until we really understand water issues,” Proctor said.

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