SACRAMENTO — Despite a sluggish economy, California wineries last year posted their biggest increase in shipments in a decade and could soon face a shortage of some popular varietals that will drive up prices, experts said Wednesday.
Many wineries, however, still find it difficult to raise prices on store shelves, even as their suppliers boost prices for grapes and bulk wine.
California wine shipments rose about 5 percent in 2011, reaching about 210 million cases, analyst Jon Fredrikson said Wednesday at the 18th annual Unified Wine & Grape Symposium in Sacramento, the largest wine industry conference in the United States.
"By far the most growth we've seen in a decade or more," Fredrikson said. "And especially considering the conditions, it was a very strong market."
Price discounting, brands designed to cater to the nation's sweet tooth, and unpretentious labeling all contributed to the industry's growth, said Fredrikson, president of Gomberg, Fredrikson & Associates, a wine industry consulting firm based in Woodside.
Fredrikson called sweet red wines and red blends the "wave of the future," and said the wine industry has brought in new consumers with "gateway" wines like moscato, sangria and chocolate-infused wines. New labels that offer sweet red blends at a value price have done well.
"It's natural for wineries to blend up what they want, and I think consumers are really getting into them," Fredrikson said. "It's a free-for-all. It's a food fight. There are so many creative marketing ideas ... There's unbelievable creativity that is in fact driving the market."
Baby boomers have remained core consumers, apparently with the attitude that "Life is too short to drink bad wine," Fredrikson said.
A preponderance of mass market media helped raised the profile of California wines in 2011. New celebrity brands like "Skinny Girl Sangria" and endorsements of moscato wine in hip-hop lyrics attracted younger drinkers, Fredrikson said. And Sonoma County's exposure as a wine brand grew with Ben Flajnik's starring role on ABC's hit reality shows "The Bachelorette" and now "The Bachelor," and will likely grow further with the appearance by Rick Tigner, president of Jackson Family Wines, on "Undercover Boss" this Sunday. Flajnik attended the Sacramento symposium and posted a photo from the conference on his Twitter account.
Pinot noir sales were particularly strong, climbing 12 percent by volume in food stores, Fredrikson said. Trendy sweet red wines jumped a whopping 200 percent. And moscato or muscat wine sales grew 64 percent in food stores. But sales of blush wines, white zinfandel, merlot and syrah or shiraz fell.
Among the hottest California wineries in 2011 was Gloria Ferrer Winery, a Sonoma sparkling wine specialist that had strong pinot noir sales, Fredrikson said.
Other North Coast wineries singled out for their performances in 2011 were Crimson Wine Group, which owns Seghesio; Purple Wine Co. in Graton; Wheelhouse Wine Cellars in Graton; La Crema in Healdsburg; Cecchetti Wine Co. in Sonoma; the Mendocino Wine Co. in Ukiah, which owns Parducci; and Shannon Ridge in Lake County.
Meanwhile, the California wine industry is heading for shortages, in part because vineyard planting hasn't kept pace with the projected demand for California wine, said Nat DiBuduo, president of Allied Grape Growers.
And rainfall has been scarce this winter, raising concern among some growers that the 2012 harvest may have challenges.