NOVEMBER 29, 2018 SAN JOAQUIN VALLEY WINE GROWERS ASSOCIATION CIATTI COMPANY GLOBAL WINE REPORT
NOVEMBER 29, 2018
SAN JOAQUIN VALLEY WINE GROWERS ASSOCIATION
CIATTI COMPANY
GLOBAL WINE REPORT
DEDICATED BROKERS IN 8 COUNTRIES
GLOBALLY BASED TO BUILD YOUR BUSINESS WORLDWIDE
CIATTI COMPANY
CIATTI CO.WINE & GRAPE BROKERAGE
- 8 Regional Offices Worldwide
- Wine, Grapes, & Concentrate
- John Fearless – Hops, Malts, Barrels
- Global Perspective
- World Approach – Local Knowledge
- Today’s Goal: Discuss World Wine – Production & Usage
CIATTI COMPANY
OUTLINE
- Global Picture
- Total World Production- Ciatti – World Production - Country by Country – Comments
- Consumption & Sales
- World Consumption - USA – Sales Update
- California
- 2018 Vintage- Regional Breakdown
- Overview & Comments
CIATTI COMPANY
GLOBAL
PICTURE
CIATTI COMPANY
GLOBAL WINE PRODUCTION
CIATTI COMPANY
VINTAGEWORLD
PRODUCTION
2018 279 MHL
2017 248 MHL
2016 266 MHL
2015 273 MHL
Source: OIV
USA 9.0%
Argentina5.0%
Germany3.5% Australia
4.5%
New Zealand 1.0%
So. Africa3.5%
Portugal2.0%
Chile4.5%
Rest of World12.5%
China6.0%
France16.5%
Italy17.5%
Spain14.5%
Total 42.6 Million Tons
CIATTI COMPANY
KEY WINE COUNTRIES
US TONS Est.
2018 2017 2016 2015
ARGENTINA 2.80 1.98 1.92 2.64
CHILE 1.97 1.37 1.55 1.97
AUSTRALIA 1.97 2.12 1.99 1.84
NEW ZEALAND 0.46 0.44 0.48 0.36
SOUTH AFRICA 1.32 1.65 1.51 1.62
SUB TOTAL 8.52 7.57 7.45 8.43
CIATTI - WORLD GRAPE PRODUCTION
USA 4.70 4.40 4.43 4.10
GERMANY 1.49 1.14 1.37 1.34
FRANCE 7.04 5.61 6.88 7.32
ITALY 7.18 6.00 7.77 7.64
SPAIN 5.94 5.50 6.41 6.42
SUB TOTAL 26.35 22.65 26.86 26.82
TOTAL 34.87 30.22 34.31 35.25PREVIOUS YEAR VARIANCE 4.66 -4.09 -0.94
% 15% -12% -3%
WINE CONSUMPTION
& SALES
CIATTI COMPANY
WINE CONSUMPTION
- North America
- USA #1 Biggest in Volume & Value- Canada #11 Major World Buyer & Juice for Home Winemakers
- Europe
- France #2 Declining Consumption - Demographics- Italy #3 Stable Consumption – Exports Needed - Germany #4 Huge Bulk Buyer – Mainly Reds- UK #6 Declining US Volume- Spain #7 Drink Spanish Wine
- China #5 Growing Consumer Market – Key to World
CIATTI COMPANY
USA SHIPMENTS – 6 months ending June
CIATTI COMPANY
TOTAL CA WINE (-2%) (-2.4M CASES)(LAST 6 MONTHS)
- DOMESTIC (-1%) (-1.6M CASES)
- EXPORTS (-13%) (-1.2M CASES)
IMPORTS (6 months)
CASEGOODS (+1%) (+0.7 M/CASES)
BULK (-19%) (-3.8M/CASES)
TOTAL US Market (YTD)
- IMPORT & DOMESTIC (-0%) (-0.7 M/CASES)
Source: Gomberg-Frederickson
CIATTI COMPANY
TABLE WINE SALES – PRICE & VOLUME
Premium
$7 – 12 = 29%
Popular
$4 – 7 = 36%
Economy
Under $4 = 21%
Super Luxury $12 above = 13%
CALIFORNIA
2018 HARVEST
CIATTI COMPANY
CALIFORNIA STATEWIDE GRAPE CRUSH
CIATTI COMPANY
2
2.5
3
3.5
4
4.5
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Ton
s in
Mill
ion
s
Winegrape Other Crush
Est.
4.3+
NORTH COAST
- Harvest
- Late and cool - Grapes sized up - Mid season rain- Capacity issues
- Market
- Chardonnay & Pinot Noir – huge volumes - Cabernet Sauvignon – new plantings arrive - Everyone is a seller
CIATTI COMPANY
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
2013 2014 2015 2016 2017 2018EST.
2013 2014 2015 2016 2017 2018 EST.
590,000
CENTRAL COAST
- Harvest
- Late crop- Cool weather - Big yields
- Market
- Paso Cab Sauv to sell – cheap spot grapes- Monterey Pinot Noir & Chardonnay- Rhone varieties for Rosé
CIATTI COMPANY
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
2013 2014 2015 2016 2017 2018EST.
2013 2014 2015 2016 2017 2018 EST.
615,000
NORTHERN INTERIOR
- Harvest
- Later than recent years- Cool growing season- Good quality
- Market
- Chardonnay and Sauv Blanc – solid vintage- Zinfandel – weak; more removals??- Cabernet Sauvignon – big- Pinot Noir – large but needed
CIATTI COMPANY
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
2013 2014 2015 2016 2017 2018EST.
2013 2014 2015 2016 2017 2018 EST.
1,085,000
SOUTHERN INTERIOR
- Harvest
- Later than recent years- Mild weather- Quality vintage
- Market
- White varietal & generic in demand- Red varietals – slowing - White Zinfandel – big challenge - Concentrate
CIATTI COMPANY
1,800,000
1,850,000
1,900,000
1,950,000
2,000,000
2,050,000
2013 2014 2015 2016 2017 2018EST.
2013 2014 2015 2016 2017 2018 EST.
2,000,000
CALIFORNIA MARKET SUMMARY
- Historic 2018 crop
- Bulk wine market slow-increased inventories-prices will soften
- Distribution channels controlled by big wineries – challenge for others
- Opportunities for new brands, Negociants?
CIATTI COMPANY
OVERVIEW & COMMENTS
- No shortages around the globe
- Imports continue to US
- Need stronger sales
- Baby boomer vs millennials
- Wine has competition
- We’ve been here before…
CIATTI COMPANY
THANK YOU FOR YOUR TIME AND ATTENTION
JOHN CIATTI [email protected]
415.458.5150
CIATTI REPORTS / PUBLICATIONS
- California Market Report
- Global Market Report
- www.ciatti.com
CIATTI COMPANY