Record-Breaking Harvest for Napa County

Remy Cointreau tries a "flight to quality" strategy and William Grant & Sons buys Hudson Whiskey's distillery.
Napa Valley Harvest, Photo by Napa Valley Vintners.

Napa County’s 2016 agricultural production reached an all-time high value of $737.3 million, with a record-breaking $729.5 million value for grapes leading the way, the Napa Valley Register reported.

Agricultural production value rose 33 percent from 2015, according to a report County Agricultural Commissioner Greg Clark presented to the county Board of Supervisors on Tuesday. It broke the previous record of $720.8 million set in 2014, with wine grape production breaking the old record of $714.8 million, also set in 2014.

Napa County Farm Bureau Executive Director Jesse Ramer praised the 2016 harvest saying, “Three-quarters-of-a-billion dollars is an impressive number.”

And while Cabernet Sauvignon remained the most plentiful type of grape, with 20,342 acres producing 66,893 tons, it was Cabernet Franc that received the highest price per ton at $7,144, followed by Cabernet Sauvignon at $6,830 and Petit Verdot at $6,024. Roussanne had the top price for a white grape at $4,250 per ton, with only 14 acres producing 58 tons. Chardonnay received $2,675 per ton.

Remy’s Flight to Quality has Begun

When things look shaky on Wall Street, investors generally head for the high ground. There’s usually a lot of buying in Tiffany or du Pont or Procter & Gamble—companies that aren’t necessarily flashy, but steady and old-line. Traders call it the flight to quality.

Louis_XIII_Beijing_store
Louis XIII Beijing store. Photo courtesy of Remy Cointreau.

Remy Cointreau is attempting such a take-off. The French distiller reported disappointing fourth-quarter sales as it ignored lower-priced offerings such as Mount Gay rum. It is also plans to raise prices 3 to 5 percent on premium and luxury brands in the coming year, Chief Financial Officer Luca Marotta told a conference call.

Unlike last year, when it blamed the sharp fall in its operating profit on a Chinese government crackdown on corruption that sapped the demand for premium cognac and other luxury goods, this year the company sees a comeback in China. Marotta told analysts and investors, “We’re very, very confident on China. The company gained significant market share in value and that’s the name of the game.”

Remy Cointreau Chief Executive Valérie Chapoulaud-Floquet is trying to turn the distiller into the world’s leading provider of high-end spirits. In September, the company opened a store in Beijing to sell Louis XIII, a blend of 1,200 cognacs between 40 and 100 years old that reaches its top $80,000 price in giant Methuselah bottles.

Jefferies noted the fourth-quarter revenues were 0.6 percent, below the consensus of 1.7 percent; the company’s fiscal 17 guidance was unchanged and so it is maintaining its hold rating on the shares which are trading at a 42 percent premium to the beverage sector average.

The Scots are coming! The Scots are coming!

Ralph Erenzo, Photo courtesy Hudson Whiskey.
Ralph Erenzo, Photo courtesy Hudson Whiskey.

William Grant & Sons bought Tuthilltown Spirits, New York State’s first distillery since Prohibition, the family-run company said. Considered the inspiration of the American craft whiskey movement, Tuthilltown produces a number of craft spirits including the award-winning Hudson Whiskey, which was acquired by William Grant & Sons in 2010.

William Grant & Sons bought the entire 36-acre Tuthilltown facility in the Hudson Valley town of Gardiner. It includes the distillery, a gourmet restaurant, visitor center and scenic grounds with riverfront views.  The purchase price was not disclosed. For a bit of context, a nearby, but much smaller, commercial venture (3,000 sq. ft. restaurant on 12 acres with 2,000 feet of river frontage) sold for $1.8 million in 2014.

Known for its 130-year history of world-class Scotch whisky distilling, this acquisition allows William Grant & Sons to venture into craft American whiskey. Ralph Erenzo, who founded the craft distillery with Brian Lee, will remain with the company. Lee will be staying on as a consultant, a spokeswoman for William Grant & Sons said.

“It is business as usual for the foreseeable future for both employees and consumers and there are no expansion plans at the present time,” she added.

Published on April 20, 2017
Topics: Wine News
About the Author
Leslie Gevirtz
Contributing Editor, Business

An award-winning journalist, Gevirtz spent more than 20 years covering disasters—natural, political, and financial—before becoming Reuters’ wine correspondent; a beat that guaranteed her colleagues were always glad to see her.



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