201 Alameda Del Prado, #101, Novato, CA, United States of America, 94949
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Ciatti California Market Report, April 2022
As we move into the second quarter of the year, California’s bulk wine and grape markets are proceeding steadily, with some particular areas – namely Napa and Sonoma – commanding high interest while other areas are quieter. Overall, while retail sales from the first quarter of 2022 are assessed, inflationary input costs are adjusted to and spring’s clusters are counted and dissected, some degree of caution pervades buying behavior.
Rabobank’s latest Wine Quarterly report cites a “perfect storm” of five challenges facing the wine industry in the US and globally: Rising shipping/ trucking costs, rising gas prices, rising labor costs, five years of geopolitical uncertainty (tariff wars, COVID-19, the Russia-Ukraine conflict) and “relatively tight” inventories after two-successive short crops in 2020 and 2021. Rabobank references a “regionalization of supply chains” in response to rising trucking and gas prices, with companies moving production closer to the end-consumer.
What we are seeing at Ciatti might be termed “supply chain parochialism”. While some buyers are expanding sourcing options in a bid to maintain margin, others are ruling-out wines or grapes located at a distance across California – even if the pricing is more attractive – because of trucking costs and/or speeds. Freight, once some way down the list of concerns during transactions as it could be taken for granted, is now in some cases the first discussion point.
The annual inflation rate in the US hit 8.5% in March, a 40-year high. Suppliers of wine to retail are seeking to take up shelf price to cover the increased cost of doing business and how consumers – dealing with their own inflationary pressure – respond will become clearer through the year.
SipSource analysts Dale Stratton and Danny Brager have presented some interesting slides which showed that December 2021-February 2022 table wine sales volumes were down versus December 2020-February 2021 by 9.7% in the under $8/bottle category and by 10.9% in the $8.00-10.99/bottle category. Sales volumes at $11.00-14.99/bottle were down by much less (-2.5%) while $15+/ bottle volumes were up 6.8%. This shows the pantry-stocking spike inspired by 2020’s Shelter in Place orders is receding further into the past on the lower priced categories, while the higher-priced wines saw good growth in 2021 – a post-Shelter in Place boost in consumer confidence – and are continuing to outperform the rest of the market. The question is: Amid the economic headwinds this year, will sales volumes on higher-priced wines fall back, and, if so, will it necessarily benefit the lower price categories?
All the unknowns are serving to make the grape and bulk wine markets – outside the most in-demand appellations – what we characterize as “choppy”: Buyers and sellers are struggling to gauge the markets they are operating in, leading to a lack of cohesive trends in terms of buying and selling behavior. Ciatti can draw on its decades of experience to help you navigate this dizzying time – don’t hesitate to get in touch. Read on for more on the bulk wine and grape markets, and stay safe.
About
With 8 offices world wide, Ciatti serves our clients with the most up-to-date and accurate market information available. Please contact us with any questions. We are truly at your service.
Greg Livengood
President, Partner and Broker
Greg joined Ciatti in 1994 and became a partner in 1997. Greg has used his degree in International Relations to build Ciatti into the world recognized leader in the alcohol beverage business. Greg is currently the President and CEO of the company and drives the international group.
Email:greg@ciatti.com
Steve Dorfman
Partner and Broker
Steve Dorfman joined Ciatti in 2007 after working with the Brown-Forman Corporation, Fetzer Vineyards, Sonoma-Cutrer Vineyards and Bolla Wine brands for 24 years. His primary responsibilities are wine and grape sales within California, and the supply demands of markets throughout Europe, South Africa and Australia.
Email:steve@ciatti.com
John Ciatti
John White
Partner and Broker
Ciatti has a long history of seeking to provide clients with a well rounded team of brokers whose experience in the industry cover the breadth of the business. John joined the company in 2003 after working as a Winemaker for several of California's major producers for 20 years. John's emphasis is maintaining relationships with California wineries ranging from the largest to the smallest. John has focused on all aspects of growth within the business, from long-term custom crush contracts to spot bulk wine and grape sales. His speciatly is the sourcing and selling of premium varietal lots from the coastal and interior regions of California.
Email:johnw@ciatti.com
Chris Welch
Partner and Broker
Chris Welch joined Ciatti in 1994, and began brokering bulk wine and grapes in 2003 and became a partner in company in 2007. The premium and super premium segment of the California wine industry are the breeding grounds of innovation and where Chris truly excels. His consistent approach helps small and medium size wineries and negotiants achieve the innovation and growth they seek. Chris also works very closely with the Oregon Wine Industry.
Email:chris@ciatti.com
Glenn Proctor
Partner and Broker
Glenn Proctor joined Ciatti in 2003 and became a partner in 2007. Glenn advises wineries on supply positioning and works closely with growers and wineries in marketing their grapes and wine. He specializes in spot and contract bulk wine and grapes sales from all regions of California. He has over 23 years of experience in wine supply strategy, wine-grape quality improvement, brand strategy, and business development. Glenn was previously the Vice President of Winegrowing for Diageo Chateau and Estate Wines, and before that was a Director at Benziger/Glen Ellen Winery during its rapid growth in the early 1990's.
Email:glenn@ciatti.com
Broker
Johnny Leonardo joined Ciatti in 2004 as a broker and knows that surviving in a dynamic wine industry requires one to be a Jack-of-all-Trades. He has experience in all aspects of winery and vineyard operation, from the field to the street. Johnny has developed and managed vineyards, and worked in wine sales and marketing.
Email:johnny@ciatti.com
Andy Bivona
Broker
Andy joined Ciatti as a broker in 1996. His areas of expertise and responsibility include grape and fruit concentrates, beverage and industrial alcohol, fruit alcohol and brandy, and food specialty products. Andy's knowledge of these products has allowed him to branch out and work throughout various parts of the world including Mexico, South America and Europe. Andy remains a wealth of knowledge and offers a creative approach to all endeavors.
Email:abivona@hvc.rr.com
Todd Azevedo
Broker
Todd Azevedo joined Ciatti in 2004 after completing his Agricultural Finance degree from Cal Poly San Luis Obispo. Although Todd brokers wine, grapes, and wine products throughout the state of California, Todd's focus is on the California Central Coast.
Email:todd@ciatti.com
Mark Ishimaru
Customer Account Representative - North America
Joined Ciatti in 2011.
Email: mark@ciatti.com
Molly Richardson
Customer Account Representation - Grower Accounts
Joined Ciatti in 2016
Email: Molly@ciatti.com
Administrative/Accounting Assistant
Joined Ciatti in 2000.
Email:alette@ciatti.com
Michael FungCustomer Account Representative - Sample Room
Joined Ciatti in 2013.
Email: michael@ciatti.com
Contact
Contact List
| Title | Name | Phone | Extension | |
|---|---|---|---|---|
| Partner/Broker | John Ciatti | john@ciatti.com | 4152640762 | |
| Partner/Broker | Steve Dorfman | steve@ciatti.com | 7073213843 | |
| Partner/Broker | Greg Livengood | greg@ciatti.com | 4154975032 | |
| Partner/Broker | Glenn Proctor | glenn@ciatti.com | 7073370609 | |
| Partner/Broker | Chris Welch | chris@ciatti.com | 4152988316 | |
| Partner/Broker | John White | johnw@ciatti.com | 4152500685 | |
| Broker | Todd Azevedo | todd@ciatti.com | 4152656943 | |
| Broker | Johnny Leonardo | johnny@ciatti.com | 4157174438 | |
| Broker | Dennis Schrapp | dennis@ciatticanada.com | 9059338855 |
Location List
| Locations | Address | State | Country | Zip Code |
|---|---|---|---|---|
| CIATTI Global Wine & Grape Brokers | 201 Alameda Del Prado, #101, Novato | CA | United States of America | 94949 |
List of Locations
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