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North Coast grape market begins to recover

NAPA — Grape growers, who are traditionally the last in the wine industry to benefit from an economic recovery, are finally starting to see a rebound in both prices and interest from buyers.

Wineries are now committing to buying more premium grapes — and paying higher prices — for the first time since the recession devastated the high-end wine market starting in late 2008, market insiders said Tuesday at a vineyard conference in Napa.

"The market has gotten better," said Glenn Proctor, a Santa Rosa grape broker with Ciatti Company. "It might actually be worth being a grape grower again."

Prices for grapes sold on the spot market in Sonoma County have jumped anywhere from a few percentage points for flagging varietals like sauvignon blanc to 50 percent for in-demand grapes like pinot noir, according to figures provided by Proctor at the 2011 Vineyard Economics Seminar.

Much of the grape buying activity in California remains in the Central Valley, which produces less-expensive wines that have been popular with budget-minded consumers throughout the recession. But in recent months, the premium markets in Sonoma and Napa have started picking up too.

Steve Dutton, whose family business farms 1,100 acres of vineyards in west Sonoma County, said starting in January grape buyers have been signing contracts to purchase his grapes for both this year and, in several cases, for multiple years.

"There is definitely a recovery underway," Dutton said.

Grape buyers are still moving slowly, and targeting specific varietals and appellations.

"Pinot noir is our hot market right now," Dutton said. "We're almost sold out."

Of course, before the recession, Dutton would not have had any surplus to sell. And it is still a challenge to sell his chardonnay, which remains in lower demand across the North Coast.

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