Cancelling Grape Contracts for Inventory Management, Not Smoke Exposure
When Constellation rejected 50 tons of his Sauvignon Blanc earlier this month, Clay Shannon thought it was odd, but was glad to have it for his own winery’s program. “I crushed it. I think it’s fine,” he said.
He thinks Constellation rejected perhaps 1,200 or 1,500 tons of Lake County Sauvignon Blanc.
Clay Shannon farms 1200 acres of Lake County grapes and Shannon Ridge makes more than 200,000 cases of wine – this year he’ll process enough grapes to produce 300,000 cases. He farms another 500 acres in Lake County for other vineyard owners.
He says Treasury Wine estates contacted him three weeks before the Mendocino Complex Fire broke out, asking him to sell any of his fruit contracted to them to somebody else because they wanted out of the contracts due to slow sales and changing direction of their portfolio. “They said they would allow us out of the contracts that they desperately asked us to sign a year ago.”
He thinks Treasury and Constellation are long on grapes and bulk wine. He notes that their wine sales are down as reported by Gomberg-Fredrickson while other wineries that are family-owned, continue to bring in Lake County Fruit.
“This is about inventory management and getting the cost of goods down. There’s more to the current rejections than smoke taint.” [WB Blog]