Apr. 6—Grape growers from around the Lodi appellation received some disheartening news about the wine market this week, but experts say things should be turning around.
The Lodi District Grape Growers Association hosted its second annual business and economic forum Thursday at the Lodi Grape Festival, featuring reports on trends and outlooks from a variety of analysts and experts.
Jon Moramarco, managing partner with Denver-based BW 166 LLC, said the wine market in 2023 was "significantly weak," but growers should not think this will be the new normal for their industry
Wine sales were down last year for a number of reasons, due to new reports from the World Health Organization about alcohol safety, and consumers buying other alcohol products, such as seltzers and ready-to-drink cocktails in a can, he said.
"There are issues with perceptions of alcohol from the WHO, which is saying there's no safe limit for consumption," he said. "We have companies making alternative beverages for consumers. There are a number of choices when it comes to beverages, whether it's alcohol, non-alcohol, or its mixed drinks, there's a lot more fro people to choose from."
In addition, Moramarco said consumers, especially those in the younger demographic, are not purchasing as much alcohol previous generations once did.
According to a 2019 Gallup poll, he said, 34% of 18-to 34-year-olds thought moderate drinking was bad for your health. In the most recent poll taken this year, that increased to 52% of 18-to-34-year-olds.
The Centers for Disease Control and Prevention defines "moderate" drinking as limiting intake to as many as two alcoholic beverages a day for men, and one for women.
Moramarco said these perceptions affect the entire alcohol industry at the moment, but things should start to turnaround.
"I actually believe the market will start to stabilize this year, and that we'll be back to normal in 2025," he said. "The sky is not falling. We're going to see some recovery in the next few years."
Chris Bitter, a senior analyst with Terrain, a firm that provides insight and forecasting, said there are three "headwinds" the Lodi appellation will be facing in the coming year: competition from import wines, declining consumption, and premiumization, or the attempt to make a product more appealing to consumers by emphasizing superiority and complexity.
Bitter said most wines produced in Lodi sell for less than $11 a bottle. However, bottles priced at more than $11 are selling more at grocery and liquor stores.