Wine demand expected to rise in US, fall worldwide

Within 20 years, 42,000 acres of new vines could be needed to meet growing U.S. wine consumption, Western Farm Press reported Jim Lapsley,  UC Davis professor emeritus of ag economics, said at the “Outlook and Issues for the World Wine Market” symposium sponsored by the UC Agricultural Issues Center in late June.

But recently, cheaper wine imports have been spurring growers to replace grapevines with more profitable crops, notes reporter Harry Cline. In the Central Valley, wine grape plantings declined from 190,000 acres in 2001 to 157,000 in 2008.

“Using UC crop budgets, wine grapes are netting only $80 per acre compared to almonds at $200, walnuts at $1,070, pistachios at $860 and pomegranates at $620,” writes Cline.

“The supply of inexpensive wines from other countries acts as a ceiling on prices for wine grape growers,” Lapsley is quoted saying regarding San Joaquin Valley wine grapes.

Based on population/demographic trends and the falling wine consumption in Italy, France, Spain and Argentina, Dan Sumner, director of the University of California Agricultural Issues Center, expects world wine demand to decline despite projected consumption increases in the U.S., U.K. and Germany.

“World wine markets may still expand as incomes grow gradually in traditional markets and wine consumption is introduced in places with rapid population and income growth,” Sumner is quoted as saying.

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