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From: lewis.perdue@wineindustryinsight.com

Subject: 100s of Wineries Can't Legally Buy Grapes ... US Wine Sales Up 5.9% - WINE INDUSTRY INSIGHT

Date: 2010-06-15 19:23:55

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EMAIL EDITION - VOLUME II, NUMBER 23 - June 15, 2010

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IN THIS ISSUE:

  • Up To 30% Of Calif Wineries Can’t Legally Buy Grapes

  • US Sales Up 5.9%, Imports Flat, $20+ Wines Still Lead Way



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US Sales Up 5.9%, Imports Flat, $20+ Wines Still Lead Way

Wines selling for more than $20 per 750ml bottle posted a 13.9 percent gain for the four-week period ending May29, helping to drive overall domestic wine sales up 5.9 percent according to scanner data from The Nielsen Company. Import sales were flat, losing a small fraction of a percentage point.

nielsen-052910-wii-4-weeks-xls1

The original analysis, interpretation and custom calculations performed by Wine Industry Insight and based on data from The Nielsen Company and the complete WII article are available to VIP Premium Subscribers. Wine Industry Insight does not sell or market data from the Nielsen Company.

TRADING SHOWS RESILENCE

Wine costing an average of $24.93 per bottle gained 13.9 percent. That average price is down from May’s $25.10 but still above from April’s average price of $24.83 per 750ml bottle.

Higher priced segments — $12-$14.99 and $15-$19.99 — also posted significant gains as well.

PRICE SEGMENT GAINS OUTNUMBER LOSSES

Five of the seven price segments posted dollar gains, all in lower price segments.

Price gainers (by average bottle price) were:

  • $24.93, up 13.9%
  • $12.47, up 7.9%
  • $16.20, up 7.9%
  • $9.98, up 7.8%
  • $4.65, up 4.9%

Losing dollar volume were:

  • $2.22, down 0.2%
  • $6.85, down 2.2%

FULL SPREADSHEET AVAILABLE

The Nielsen Company spreadsheet that includes the data on which this article is based is available here for VIP Premium subscribers. Even this full spreadsheet represents just a very small fraction of that available to Nielsen clients.


Up To 30% Of Calif Wineries Can’t Legally Buy Grapes

Up to 30 percent of California wineries lack the legal authority to purchase wine grapes according to data from the California Department of Alcoholic Beverage Control (ABC) and the Market Enforcement Branch (MEB) of the California Department of Food and Agriculture (CDFA).

WINEGRAPE PURCHASES ILLEGAL WITHOUT A PROCESSOR LICENSE

Established in 1932, the MEB licenses dealers, brokers, commission merchants, cash buyers, and processors that handle California farm products for the purpose of resale or processing.

California law provides that no winery can legally buy or contract for grapes unless it has a valid processor’s license.

According to its web site, MEB “actions may range from Notices of Violation, Probation, Suspension, or Revocation of a license, to the Denial of an application for a license. [It] can also refer flagrant violators to local law enforcement agencies for civil and/or criminal prosecutions.”

VIP Premium subscribers can click here to get an alphabetically sorted list (.xls) of all wineries and other companies with processors licenses that expired as of May 31, 2010.

This list includes only those previous holders of a processor’s license which has now expired. The number of licensed winegrowers in California who lack a license is several times larger than the 263 names on this list.

Companies listed here may have renewed since June 15, 2010 when Wine Industry Insight downloaded the full MEB processors list. Other companies listed as expired may have obtained a license under a new name.

VIP Subscribers: Click here to read the complete, un-redacted article.

HUNDREDS OF WINEGROWERS LACK MEB LICENSES TO LEGALIZE GRAPE BUYS

(The remainder of this section is available to VIP Premium Subscribers)

ACTUAL PERCENTAGE OF UNLICENSED WINERIES COMPLICATED BY DATA DIFFERENCES

(The remainder of this section is available to VIP Premium Subscribers)

CORPORATE STRUCTURE & OWNERSHIP CAN CONFUSE LICENSE REQUIREMENTS

(The remainder of this section is available to VIP Premium Subscribers)

GROWERS SHOULD MAKE SURE WINERIES ARE LICENSED BEFORE SIGNING CONTRACTS

“It is best that a grower ask the winery or vintner for a copy of the license or license number to verify with our office,” said MEB Chief D’Esterhazy. “It’s the easiest way to follow up.”

Since obtaining a processor license requires meeting a number of standards that  include Weighmaster licenses and certification for scales, growers should be leery of unlicensed wineries.

The MEB updates its licensed winery database each week. Click here for the most recent (06/15/10) list  (.xls).


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Lewis Perdue
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Phone: 707-326-4503, fax: 707-940-4146
Email: lewis.perdue@wineindustryinsight.com