NAPA — North Coast vintners and grape growers are in the midst of another difficult year. That was the consensus of industry insiders at a wine conference Tuesday in Napa.
The recession that prompted wine drinkers to become more frugal continues to disrupt the high-end wine markets of Napa and Sonoma counties.
"It is going to be a tough year," said Glenn Proctor, a San Rafael grape broker who connects growers and buyers. "The grape market is a big question mark right now."
The turmoil pits wineries against growers, as both sides hope to get the best possible prices during a down market. But this year the advantage is shifting toward wineries, which still have unsold wine from last year's bountiful harvest.
"Buyers are very cautious. They are not buying unless they need it," said Proctor, a partner in Ciatti Company. "And even then they're not buying."
Fewer grape growers are locked into long-term contracts than last year, according to a survey unveiled Tuesday. It found that about 10 percent more growers this year have recently established short-term contracts or are now forced to sell on the spot market, both of which pay far less than the lucrative long-term contracts signed at the peak of the market in 2007.
Growers who don't already have contracts are being told to lock in one-year contracts at whatever price will allow them to limp through the season.
"Maybe we need to accept prices that just let us make a living, maybe make some profit," said Nat DiBuduo, president of Allied Grape Growers. "But do not expect the old higher prices."
But even that is challenging in the current climate, Proctor said. There is an imbalance between how many tons growers hope to sell on the open market and how much wineries want to buy right now, especially if predictions of another large harvest come true, he said.
"In this market, even buyers are trying to sell," he said.