“We lack a crystal ball to show us what 2020 will bring” we wrote in our report last January, reading now like a quaint comment from a more innocent age when small movements in demand or prices were the talking points of the marketplace, not global pandemics and record-breaking wildfires. In light of 2020’s subsequent developments, we at Ciatti would like to wish all our friends, clients and business associated a very happy, healthy – but also uneventful! – 2021. We thank you all for your continued support.
California’s bulk market enters the new year in a more balanced supply-demand position as COVID-19 from March onward, then severe wildfires from August onward, quickly depleted the state’s large 2018 and 2019 inventory. For example, we estimated that, by December 2020, Cabernet inventory was approximately half December 2019 levels. Bulk prices rose through mid-year, then plateaued in the final quarter; the Coast/California price separation returned after a two-year absence, though to what extent and for how long is questionable while the on-premise remains shuttered in many areas of the US.
It goes without saying that 2021 is hard to predict: On the one hand, COVID-19 is – now more than ever – an acute problem for the US and the world; but on the other hand, the vaccinations against it have been rolling out since December. The speed of this rollout is likely to determine the speed at which life can return to some normality. But it cannot be taken for granted that, when normality is re-enabled, life will return to how it was pre-2020. Consumer confidence, as well as retail and restaurant districts, may be scarred for the longer-term, particularly as the full economic consequences of the COVID-19 measures start to filter through. In the meantime:
- Wineries should let us know what 2020 bulk wines they have available so that we can help them find a buyer. Likewise, buyers of bulk wine should let us know their requirements so we can get them fulfilled quickly.
- Grape suppliers should update us on the 2021 grapes they will have for sale. Buyers of grapes should register their interest with us so we can match them up with a supplier.
To get your bulk wine listed, contact either Jed at +1 415 630 2548 / jed@ciatti. com or Mark at +1 415 630 2458 / mark@ciatti.com. To get your grapes listed, contact Molly at +1 415 630 2416 or molly@ciatti.com.
Ciatti is here to help you navigate the market – whatever 2021 throws up. Our California and Global reports will continue to provide insights, but for the fullest and most up-to-date picture don’t hesitate to get in touch with us directly.