Allied Grape Growers Places Its Bets On California 2014

Among other news, Allied Grape Growers has handicapped the 2014 season in the latest issue of its newsletter.

Direct excerpts from the newsletter, below:

COASTAL REGION: THUMBS UP

All things considered, we anticipate that coastal regions will experience a mostly stable market, based largely on an anticipated decrease in production due to water/weather challenges and recent production history. Additionally, sales of high-end wine continue to improve, and additional bearing acres are still very limited on the coast. We anticipate wineries to be able to move through inventory enough to make space for what may come in 2014. We give the coast a “thumbs up” for 2014.

INTERIOR: THUMBS SIDEWAYS

The interior regions, on the other hand, have the huge “unknown” of additional acres coming into production. We didn’t discuss acreage in detail herein, as that will be in our next newsletter, but we will consider it nonetheless. Lodi doesn’t have as many new acres coming into production as the Central and Southern SJV, and with two huge crops under its belt, that region is likely to produce a very “balanced” crop in 2014, maintaining the market and possibly providing some inventory relief for buyers. We do anticipate the Lodi market, much like the coast, to be stable, but we would give it a “thumbs sideways” overall.

CENTRAL & SOUTHERN SAN JOAQUIN VALLEY: THUMBS SIDEWAYS

The Central and Southern SJV market is the wildcard for 2014. With a recent history of two relatively “normal” crops, the likelihood that most growers will find some source of water and the fact that many new acres will begin bearing this year makes guessing the direction of the market a real challenge. It is very possible that the region will produce over two million tons in 2014, providing no supply “relief” for buyers.

The question is: “Do they need supply relief?”

We will be watching wine shipments closely over the next six months as this, coupled with weather and crop development, guide the SJV market. desirability eases like we think it will, that will help substantially. We don’t anticipate any substantial increases in market activity or demand from 2013. We are hoping to maintain the stability we experienced last year. For now, we give it a thumbs sideways.

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