Sonoma County grape growers with fast-ripening crops face prospect of low bids - or no bids - as wine industry struggles

  • Salvador Becerra ties off netting to protect pinot noir grapes from birds at a Carneros vineyard, under the care of La Prenda Vineyards Management, near Sonoma on Thursday afternoon, August 6, 2009.

Sonoma Valley grape grower Ned Hill?s chardonnay is ripening beautifully, sweetened by warm, sunny days and kept crisp by cool, foggy nights.

But with the start of the annual North Coast grape harvest just days away, Hill still hasn?t found a winery to buy a large chunk of his precious crop, even at prices 30 percent below what it fetched last year.

?Just when we were finally getting to feel pretty good about having our crop sold at prices that were fair, now we?re back to square one,? Hill said. ?It?s very disappointing.?

High-end wineries across the North Coast face growing inventories of unsold wine as cost-conscious consumers have lost their taste for wines above $20. Tight on cash and unsure when demand will return, many wineries so far this year are buying only the bare minimum of grapes they need.

?This is going to be a market where they wait until they see the whites of their eyes,? said broker Glenn Proctor of San Rafael-based Ciatti Co. ?They?re only going to buy it if they really, really need it.?

One factor driving prices so low is that wineries have entered the market as sellers, instead of buyers, further increasing supply.

That?s squeezing a lot of growers who?ve invested heavily in crops that are nearly ready to be picked but still don?t have a home.

While most of Sonoma County?s 61,000 acres of vineyards are pre-sold under contracts to wineries, up to 20 percent of the crop typically sells on the open market in the months before harvest.

But early this year, after seeing wine sales slide sharply as the financial crisis deepened in the fall, wineries offered dramatically lower prices for grapes, said Brian Clements, a partner with Novato-based Turrentine Brokerage.

Instead of the $3,500 or more a ton they paid for Napa cabernet sauvignon the previous year, wineries were suddenly offering $2,500. Sonoma pinot noir that had fetched $2,800 to $3,000 a ton might today remain unsold at $1,700 a ton, he said.

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