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U.S. wine exports, revenue fall in 2009

By Mark Glover, McClatchy Newspapers, Source: MCT News Service

SACRAMENTO, Calif. _ Wineries toasted a little less success abroad in 2009, but this year shows more promise.

U.S. wine exports _ with California accounting for 90 percent of that total _ were down by volume and value in 2009, according to the San Francisco-based Wine Institute.

The institute said 2009 exports totaled 110.4 million gallons, down about 15 percent from 129.7 million gallons in 2008. The value of wine exported by the United States last year was $912 million, down nearly 10 percent from more than $1 billion in 2008.

The institute said last year's largest decrease, 21 percent, was in shipments to the European Union, the biggest importer of U.S. wines.

"The California wine industry was not immune to the global recession but fared better than most wine-producing countries," said Robert Koch, institute president and CEO. "Fourth-quarter (2009) sales were up nearly 16 percent compared to the same period in 2008, giving us reason to believe that 2010 will be a good year."

The institute also noted that 2008 was a record year for both volume and value of U.S. wine exports.

Institute officials believe foreign nations were still drinking Golden State wine last year but being more conservative in their purchase habits.

"In this economy, we're pleased to see that consumers abroad are still enjoying wine. Consumption is not really down as much, as foreign importers are buying conservatively to reduce their investment in any significant inventory," said Linsey Gallagher, an institute spokesperson.

California exports about 20 percent of its overall wine production, and nearly 42 percent of U.S. exports are shipped to the European Union. Revenue sales of European Union exports fell 22 percent to $380 million last year.

The institute said the revenue decline was due in part to wine producers exporting bulk wine for bottling overseas to save on transportation and packaging costs. Officials said duty increases in the United Kingdom also affected exports to Europe.

Other top markets for U.S. wine exports in 2009 were Canada, $242 million; Japan, $79 million; Hong Kong, $47 million; and China, $36 million. Also in 2009, the institute said, the United States overtook Chile as the largest bulk wine exporter to Japan.

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California wineries are coming off what is projected as the second-largest grape harvest in state history. Last month's preliminary grape crush report by the state Department of Food and Agriculture says California wineries crushed 3.67 million tons of grapes in 2009, up 682,000 tons, or more than 20 percent, from 2008 and just short of the 3.76 million tons in 2005.

"It was a one-in-10-year kind of harvest," said Joe Norman, assistant winemaker at Heitz Wine Cellars in St. Helena.

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(c) 2010, The Sacramento Bee (Sacramento, Calif.).

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