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18 WINES&VINES March 2016 WINE INDUSTRY NEWS S acramento, Calif.—The biggest concern for the U.S. wine industry may be that the market for wine is too attractive to competing coun- tries, according to speakers from the "State of the Industry" ses- sion held Jan. 27 during the Uni- fied Wine & Grape Symposium in Sacramento. One of the most trusted and experienced wine industry ana- lysts, Jon Fredrikson of Gomberg, Fredrikson & Associates, esti- mated 2015 wine shipments into the U.S. market totaled 383 mil- lion cases, which he called an all- time high. Net imports grew by 1% to take 31% market share based on 10 to 11 months of data. Economist Mike Veseth said Argentina is poised for a renais- sance as a wine exporter, which poses another threat to domestic wines. "It was once thought to be the red New Zealand," he said, referring to that country's unstop- pable growth in white wine ex- p o r t s . A r g e n t i n a ' s n e w government is expected to elimi- nate or reduce a hefty export tax, which may lead to an influx of Argentine wine to the U.S. Steve Fredricks, president of Turrentine Brokerage in Novato, Calif., said many of the major im- porters are suffering from a de- cline in demand for value wine. Spain, Italy and Chile used to count on helping to fill the Ameri- can demand for wines priced less than $9 per bottle. With that de- mand shrinking, he said some countries like Italy and Spain are investing in improving quality. Chile has good supplies and low prices thanks to the exchange rate, and Chilean wineries are looking to get higher prices in the U.S. market. Australia's woes continue with growers there pulling vine- yards because of low prices and weak demand. "No one in the world is surviving and thriving in the value segment," Fredricks said. Nat DiBuduo, president of farming association Allied Grape Growers, painted a bleak picture for California's San Joaquin Valley, which supplies much of the Cali- fornia appellation wine sold in the value category, which he defined as bottles retailing for less than $7. The ongoing trend toward premiumization has not been kind to this area, and DiBuduo said 20,000 vineyard acres had been pulled in the California interior since the 2015 harvest. Removals are likely to continue through spring, he added. The premium wine sales trend is playing into the hands of mid- priced wine producers, as many consumers previously spending $3-$7 per bottle have relocated to the $7-$10 per bottle neighbor- hood, he said. Planted acres of Pinot Noir, Pinot Grigio and Petite Sirah are expected to climb in order to fuel this trend. —Wines & Vines staff Unified Speakers: Imports Up as Value Brands Suffer Jon Fredrikson speaks during the 'State of the Industry' address in January. KEN FREEZE Let your wines speak directly to their target markets through premier packaging. Select from our premium bottles or custom design the ideal bottle, pewter label or other packaging solution to promote and sell your fagship wines. East Coast usa@estal.info 305 443-7451 West Coast info@globalpackage.net 707 224-5670 A Package Speaks a Thousand Words GP144368