March was wetter and cooler than average across California. Continued rainfall helped keep frost at bay, with no serious damage reported, and Sierria Nevada snowpack was at 110% of normal as of April 1st. As March turned to April, some Coastal vineyards at higher elevations received a sprinkling of snow, near-freezing overnight temperatures were expected in some pockets, and there was some hail, but – for the time of year –vineyards experienced nothing out of the ordinary. The growing cycle appears to be ahead of last year, with bud-break occurring at a more normal time, welcome considering the lateness of the 2023 growing season. 

According to viticultural climatologist Gregory V. Jones, April has an equal chance of being slightly wetter or drier than average, and an equal chance of being slightly warmer or cooler. While grape growers and buyers wait to see how the month pans out, the grape market continues to be quiet, and unless April brings a significant weather event, we expect the cautious pace of grape contracting to continue, given the challenging wine sales context. 

The bulk market, meanwhile, continues to proceed slowly but steadily. Bulk inventory is building as more 2023 wines become available, and is larger now than at this stage of last year, not only on Cabernet but also – among others – Chardonnay (assisted by a 24% uptick in output between 2022 and 2023) and Pinot Noir. Zinfandel demand is flat, and its inventory stable, despite a 26% decline in its crop size. Latest data from SipSource suggests continued retailer/distributor destocking of wine inventory due to lack of need – with wine depletions down 8.6% in the December 2023-February 2024 period – and forecasts an improved performance in March and April only because of very soft 2023 comparables. SipSource said that, with interest rates remaining high, it did not expect retailers to increase the inventory that they hold, “but a strong consumer pull would ease our pain”. 

In the meantime, many in the wine industry are struggling for cashflow and we are hearing of more issues related to delayed payments. Wine businesses are carrying out rightsizing and some growers are grafting over or pulling out vines, leasing out land for other agriculture, or putting their operations up for sale. Grape and bulk wines suppliers are showing flexibility in accommodating potential buyers and getting creative in order to help lure in interest. 

Read on for a detailed assessment of the bulk wine and grape markets and – for the most up-to-the-minute information – get in touch with Ciatti directly. The broker team stands ready to draw on its decades of experience to help navigate buyers and sellers alike through the present challenges, and beyond.

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Grape Market Bulk Wine