Last weekend we experienced a very high temperature heat wave of over 108 degrees F. The heat wave extended throughout the State. It was a lot cooler a day or two later. We were very lucky several weeks ago to have missed the dramatic heat wave that hit the Northwestern States and British Columbia. Other than this last current heat wave, the weather has been ideal with cool evenings and warm days. Veraison is progressing typically for this time of year. Below is Old Vine Zinfandel in Lodi taken a week ago.
Before the heat wave, we looked at a lot of vineyards. To our surprise we were shocked with the size of the crop. Zinfandels are showing a very light crop for the second consecutive season with Pinot Grigio a close second. Cabernet Sauvignon surprisingly is the variety that is showing the best crop. Merlot and other varieties are fair to good. This hot weather will probably reduce overall crop size.
There is no question that the State is in a very serious drought condition. How fast this drought occurred is shocking. It was just two years ago when all of the State’s reservoirs were full. This year many growers have fallowed a lot of land because of their concerns that very little water would be available from various irrigation districts throughout the State. Most vineyards are irrigated by wells but district water is cheaper and better quality. The governor has formally requested that people reduce their water use by at least 15%. No rain this winter will be a disaster for everyone.
Covid Repercussions
Transportation - Transportation will be terrible this year. Not only are prices for full load shipments beyond imagination, especially to the East Coast, but there is not that much availability of drivers. Prices for East Coast shipments are over $5,000.00 more than last year. It appears that Midwest shipments are about $1000 to $2000 more than last year. There are about 1100 lugs or 20 tons per shipment, which could add an additional $5 per lug just for increased freight costs. The increase in freight will even be greater for those shipments that include several drop (delivery) locations. According to DAT Trendlines™, June 2021 versus June 2020 refrigerated truck load rates are up +111.7%, with a current load to truck ratio in California being 12+ loads available per truck.
Labor - Throughout the agricultural industry, labor shortages abound. Picking crews are at best at half staff for all crops. There will not be enough labor to harvest the grape crop from the actual harvester operators, forklift drivers, and truck drivers. In our last Newsletter we said we were not concerned, however, right now everyone is concerned. We have had a very reliable crew for many years. We hope that relationship continues. One of the biggest problems at the end last year was losing some of our crew to marijuana harvesting. We hear they are telling people that they will guarantee minimum $200/day payable every day in CASH.
Supplies - Everything is going up in cost. We have ordered all of our supplies not knowing what the final price of many items will be. We are also concerned that the price of grapes may even go higher than they are now. Once the size of the crop is realized (e.g., short crops), wineries will bid even more money for the few grapes that are still available, driving the price further up. There is a very serious concern that wineries may not be able to timely harvest the crop either. Transportation and Labor will also haunt them, maybe even more so.
Outcome
Every grapes season has had it concerns before the start of the season. This year it is worse. Please let us know your needs as soon as possible. We have bought a lot of grapes early but maybe not be enough grapes and the prices continue to go up. All we know is that everyone is going to have patience.
