How will food supply and demand change as a result of the Corona virus? Consumers in uncertain economic times will adjust their purchasing habits, even for essentials like food. This according to UC Davis Economist Dr. Daniel Sumner, who says different agricultural products will be effected in different ways.
“You do have to think about it commodity by commodity. Which ones are most sensitive to income. Which ones aren’t,” noted Sumner.
“Let me just give you a quick example from the wine industry. The premium wine industry here in California, which means the grapes that are grown along the coast. Higher proportion is sold in restaurants. Higher proportion is income sensitive. And people that still want to drink wine, they now drink it at home,” explained Sumner.
“They’re a little worried about their job. They say, ‘gee am I going to get laid off?’ whatever. ‘My company’s not making any money’. ‘I don’t get my bonus’, whatever.,” said Sumner. “They move down and move in the direction of Central Valley wines. So you could have the Central Valley wine industry be better off at the same time, the coastal wine industry is hurt. And we saw that in a recession 10 years ago,” Sumner said.
Dr. Sumner says staple goods are more likely to see strong demand while those perceived as luxury items may struggle. This is especially true for products that are sold through restaurant or food service channels.
By Muriel Bañares Miller, Brown·Miller Communications
Every facet of the wine and grape industry, from science and technology to trends and markets, was examined and discussed at the 25th Unified Wine & Grape Symposium (Unified), which wrapped up Jan. 31
The largest wine and grape trade show of its kind in the Western Hemisphere, the Unified drew thousands of industry professionals from all over the world eager to hear about the impact of regulatory changes, trends, technology, research, and issues shaping their business decisions.
“If you want to understand what’s happening in the industry and how to stay competitive, the Unified is the place to be,” said John Aguirre, CAWG president. “The Unified draws nearly 14,000 from all over the globe, including exhibitors from nearly 30 countries. For 25 years, the Unified is where industry leaders and professionals meet to discuss the latest news and share strategies for staying abreast of changing markets, technologies and regulations.”
Put on by the industry for the industry, the three-day conference draws on some of the most respected industry experts. The three days of sessions included 26 presentations and panel discussions organized by a diverse panel of volunteers who recruited nearly 100 experts to speak on topics ranging from digitalization in the vineyards to how cannabis is affecting the wine industry. Complementing those talks was a two-day, 170,000-square-foot trade show that housed nearly 700 exhibitors.
In 2020, the Unified will be at Cal Expo, a temporary host site, due to the Sacramento Convention Center’s large-scale renovation that will close it down starting this summer. With the Unified set for February 4-6, Cal Expo will provide an alternative to the Convention Center with ample space, parking and facilities for a conference of Unified’s size.
“Cal Expo, as a premier regional event facility, is excited to host the Unified Wine and Grape Symposium in 2020,” says Rick Pickering, CEO and General Manager of California Exposition and State Fair. “We look forward to working with Unified and the City of Sacramento to make the transition extremely smooth and the 2020 show a huge success.”
The organizers of the Unified share that optimism.
“We are confident that, while the 2020 show will have a slightly different feel, the quality of exhibits, presentations and networking opportunities will again deliver an invaluable service to all of our guests and the industry,” says ASEV Executive Director Dan Howard. “We’re excited to return to the newly renovated Sacramento Convention Center in 2021. It will offer opportunities for expansion, including additional nearby hotels.”
Celebrating California Agriculture – A Refreshing Perspective
By Laurie Greene, Editor
Peterangelo Vallis is the executive director of the San Joaquin Valley Winegrowers Association based in Kingsburg, CA. Today, he discusses the great care farmers put into their land.
“Hey, we don’t make any more land. God gave us a green earth. That is what we’ve got, and we live in the best possible place to grow virtually anything,” said Vallis.
“In most cases, anything that has been farmed here in California has been farmed for a hundred years. The soil is better now than it was naturally because we are taking better care of it. We’re putting more natural green material back into the ground,” Vallis explained.
“We are stewards of the land, and we have to be cognizant of that. We have to publicize that fact because farmers are the best people at caring for the land,” he said.
“I think oftentimes we are so busy caring for the land, we don’t do as good of a job pumping our chest up to everyone, going, ‘Hey! You know what? You come try to do this. You try to do it half as good as me, ‘because I’ve learned things from school. I’ve learned things from my family. I’ve learned things from generations. I’ve learned things just because I’m here doing my job and watching out,” Vallis said.
Vallis believes we need to widen the conversation and tell more people that farmers do the things they need to do; they do the things that benefit all society.
“We are proud of what we are doing. You know what? People who eat are the direct beneficiaries. Everyone who opens a can of beans. Everyone who goes and gets some lettuce out of the fridge. Everyone who eats beef, chicken or any other meat benefits from our taking care of the land to continue to produce,” he said.
“No farmer I know and no farmer I have ever met actively goes out and poisons our land, because then they can’t make food. Making food is what we are called to do.”
Jon Moramarco is managing partner of BW 166 LLC. The name BW 166 LLC is an homage to the family’s roots in the California wine business. Jon’s grandfather Giuseppe Moramarco, the tenth generation of his family to be involved in the wine business, acquired Bonded Winery 166 in downtown Los Angeles during Prohibition. A graduate of UC Davis, Moramarco started out young as vineyard laborer and progressed through both vineyard and winery jobs.
A lot has changed since then, and Moramarco explained current trends in U.S. wine consumption. “A core wine consumer is considered somebody who drinks wine at least twice a week or more. You have a certain segment of the society that actually has adopted wine as part of their daily life: 36% of legal drinking age adults drink 85% of the wine. You do the math; those people are drinking 100 bottles to 110 bottles a year. That’s truly the [consumer] target for most wineries for their marketing.”
Though wine is often associated with a level of mystery and romance, Moramarco shared, “I look at wine a little differently. I look at it as a way to enjoy life with friends. It’s an affordable indulgence but it’s also one of those things. Sitting around with friends and having a glass of wine with dinner, just makes the whole experience a little more enjoyable. The funny thing is, you can have a very good wine during a dinner with somebody you really don’t like, and wine doesn’t taste as good.”
The California wine industry continues to show healthy, steady growth with total volume growing about 4% a year. Varietal wines of good quality and reasonable price have seen quite a bit of growth in the market. Moramarco deciphered wine pricing as it relates to growth, beginning with two price-per-bottle categories, $7 – $12 and $12 – $20.
“Unfortunately,” Moramarco commented, “wines under $7, are a little softer, but it’s because consumers are trading up and drinking better. So the [trend] is that they’re not drinking as much of the less expensive wines, but they’re drinking more of the more expensive wines.”
There are at least two dozen major fires burning in the wilderness of California. Many are now contained, while others are only minimally contained. One recent serious fire, known as the “Rocky Fire” in Lake, Yolo, and Colusa counties burned nearly 70,000 acres before firefighters extinguished it last month.
But smoke from that fire may yet cause problems for the wine grape industry in Napa, Sonoma, and Lake counties. James Kennedy, chair of the Department of Viticulture and Enology and director of the Viticulture and Enology Research Center at California State University Fresno, explained the threat of smoke taint on winegrapes. “Anytime you have wildfires near vineyards,” Kennedy said, “there is a concern about how that smoke might become associated with grapes, and as a result, become associated with wine.”
Kennedy said they learned a lot about this problem from the Australian wildfires in 2003 that tainted their wine. Kennedy explained,“grape growers are oftentimes not aware of the extent to which smoke can damage fruit. In a sense, it is a two-edged sword. When wine is made from smoke-tainted grapes, it will have characteristics reminiscent of ‘the morning-after ashtray’ that is quite obnoxious and certainly not desirable. The other side of the sword occurs when smoke compounds interact with the grapevine and grape berries, it is modified by the grapes. Like an iceberg in the ocean, the ice above the water suffers the apparent smoke taint; whereas, the massive chunk underneath the ocean, though not initially as obviously smoke-tainted, reveals obvious taint over time.”
Kennedy said, “Winemakers in Australia realized that while you can treat that initial smoke taint, you don’t resolve the long-term taint problem. We, as an industry, are trying to identify vineyards with smoke taint problems before their fruit is made into wine. By testing grapes in laboratories, we are trying to prevent those wineries from wasting significant investment in converting tainted fruit into tainted wine.”
The Napa Valley Vintners nonprofit trade association reported on its website yesterday, “So far no vineyards or wineries in Napa County have been threatened by any of this season’s wildfires. Most of the time the fires were burning, the smoke blew away from Napa County due to the typically prevailing winds from the southwest. The weekend of August 15/16, we did experience very hot temperatures and a wind shift that caused our air to be hazy and smoky as a result of the many fires burning throughout CA. However, there were no reports of smoke taint affecting Napa Valley wine grapes as a result.”
“Most reports on smoke taint indicate that it exists only after an extended period of close contact with smoke; conditions that have not, to our knowledge, existed within Napa Valley this summer. Furthermore, Napa Valley is known for the highest standards of fine wine production and our winemakers will be paying very close attention to this situation as they harvest grapes for the 2015 vintage.”