Sales of California Wines Keep Breaking Records and Hitting the Premium Market

California Wine

In 2016 Californian wine sales hit a new record with an estimated retail value of $34.1 billion. The state shipped an all-time high of 238 million cases to the U.S, up 2% from the previous year. Including shipments to the U.S. California wine sales to all markets, including shipments to the U.S. and exports, got a record of 285 million cases in 2016.

Robert P. (Bobby) Koch, Wine Institute President and CEO said, “Consumers worldwide recognize the high quality of California wines from diverse regions across the state. As consumers in the U.S. and around the world continue to trade up to premium wines, California is ideally positioned.”

Many wineries are targeting niche sales channels, such as tasting rooms and direct-to-consumer sales which have now reached more than 4% of the total volume. Californian wines selling for $10 and more are showing growth, accounting for 19% of the volume and 40% of the value in U.S. food stores. Wines under $10 are down, but still holding 81% share of the shipment volume and 60% of the revenues.

“Consumers are finding more ‘in store’ restaurants and bars and also wine service in less traditional locations such as bookstores, nail salons, coffee shops and movie theaters, even car wash and car repair shops,” said Danny Brager, Senior Vice President of Nielsen’s Beverage Alcohol Practice Area. “Wine is a growing category, and it is being offered in new and different venues, as well as interesting, alternative packaging vehicles, such as cans, single-serve containers, premium boxes and wines on tap.”

According to Nielsen measured U.S. food store volume, Chardonnay remains the largest varietal of all wine types accounting for 20% share of the cases, followed by Cabernet Sauvignon (15%), Red Blends including Sweet Reds (12%), Pinot Grigio/Gris (9%), Merlot (7%), Pinot Noir (6%), White Zinfandel/Blush (6%), Moscato/Muscat (5%) and Sauvignon Blanc (5%).

The shipment of sparkling wine and Champagne have increased by 14% from the previous year reaching 25.6 million cases in 2016. The category is showing very strong growth with Prosecco a key growth driver. Sparkling wines/champagne accounted for a 6% share of the U.S. wine market.

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