Wineries see fall from grapes

Thanks to frost, then heat, drought and fires, some vineyards expecting the worst this harvest season.

NAPA, Calif. — Bob Milat has been in the wine business in one way or another for about 50 years. He can't remember an autumn quite as bad as this one.

Grape production at his 20-acre vineyard in Napa Valley is down by more than 35 percent. Some varieties, such as those he grows for popular zinfandel wines, are down more than 50 percent. He picked so few grapes this year that his Milat Winery didn't have enough to make some types of wines.

"Everybody is hurting," Milat said as he walked along a row of just-picked vines on a recent afternoon.

As the harvest season nears its end in the nation's wine-making capital, many vineyards are discovering that the worst frost in 30 years, back in April, followed by months of high temperatures, drought and fires, are making this one of the worst seasons ever for grape production.

As a result, consumers nationwide could see higher prices and fewer bargains for some types of domestic wines, industry observers say.

Don't start crying in your Syrah just yet. Nobody is predicting a shortage of good vino, especially with imports from Australia, South America and elsewhere still flooding the market.

But you might soon have to pay a couple of extra dollars per bottle, especially for higher-priced wines — more than $20 a bottle — and the lowest-priced, those that bring less than $5.

The areas of California that grow grapes for wines in those price ranges were hit hardest by the frost and foul weather that followed, wine industry experts said.

Because winemakers elsewhere often get at least some of their grapes and juices from California, other states could be affected, too.

"It may cause us some challenges," said Dacota Haselwood, executive director of the Texas Wine and Grape Growers Association.

Even in a good year, Texas winemakers typically get about 25 percent of their juice stock and grapes from other states, including California, Haselwood said.

And this wasn't a good year for Texas grapes. Cold weather and hail damaged the Texas crop, which means some Lone Star State winemakers could need more out-of-state grapes than usual.

California produces about 85 percent of the nation's grapes and wine, dwarfing every other state. Golden State vineyards contain about 800,000 acres of grapes, compared with about 2,900 acres in Texas, according to the U.S. Department of Agriculture.

It's not that Mother Nature hurt every California grape grower this year. Some of the state's wine-growing regions went completely unscathed. Others suffered only slightly.

About halfway through its harvest, giant winemaker Kendall-Jackson is predicting its grape yields will be off only 5 to 10 percent, company spokesman George Rose said.

Hall Wines in Napa Valley, owned by Dallas businessman and former Dallas Cowboys co-owner Craig Hall, is expecting a similar decline in production.

Hall Wines President Mike Reynolds considers himself among the lucky ones in Napa Valley.

"In certain parts of the valley some people didn't get hurt at all," Reynolds said. "In other places, they got wiped out completely."

Exactly how bad California's grape harvest will be this year won't be known for at least a few more weeks, when vineyards finish the picking they started in September. The state doesn't release its annual grape crush report until February.

Steve Fredricks, managing partner of Turrentine Brokerage, a wine and grape broker, predicts overall grape production in the storied Napa and Sonoma regions to be down by 10 to 30 percent this year.

Simple supply and demand means something's got to give, he said.

"There is certainly going to be increased pressure for people to raise prices" for both grapes and wine, Fredricks said.

Perhaps most troubling for winemakers — and wine drinkers — is that this year's California grape shortfall might be a harbinger of future shortages.

Like any industry, the wine business is subject to booms and busts.

About six years ago, overplanting among California vineyards resulted in a grape glut that drove down fruit prices. In reaction, many vineyards ripped out grapevines and replaced them with other, more profitable crops.

Few vineyards have replanted, although though the nation's wine consumption continues to grow. Even where grapes have been replanted recently, it will be several years before vines bear wine-ready fruit.

"There's no doubt that if you look at the planting activity that's been absent in the last few years and the continued growth in the wine market, we're approaching shortages in some varietals," said Karen Ross, president of the California Association of Winegrape Growers. Especially in short supply are pinot noir, pinot gris and riesling grapes, Ross said.

Tight credit markets, economic uncertainty and the meltdown in real estate means it's unlikely that many winemakers will rush out to buy more land and plant more grapes any time soon.

"This will get worse before it gets better," said Fredricks, the wine and grape broker.