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Wildfire's impact on Sonoma wine industry

The Wine Business Institute at Sonoma State University has released findings of its wildfire impact study of the North Coast wine industry. They are based on a survey of more than 200 vineyard and winery stakeholders across Sonoma, Lake, Mendocino, Napa and Solano counties, in addition to an early analysis of available economic data. The study was launched in October following inaccurate accounts of the extent of damage to the region’s wineries and vineyards from wildfires in the north San Francisco Bay Area.

While the wildfires were unprecedented in Northern California, the survey found that the actual impact on the North Coast wine industry was localized and limited. Labor and employment data across sectors shows a statistically insignificant decrease in the months of October and November consistent with historical averages. Indirect impacts of the wildfires were more widespread, including a short-term reduction in visitors to the region.

“The most significant impact on the North Coast wine industry was an immediate and temporary slow-down of visitors to the region,” said Honore Comfort, SSU Wine Business Executive in Residence. “We believe this was driven by images and reports at the height of the disaster. Fortunately, the numbers show that this trend has corrected and continues to improve.”

Key findings to date:

99.8 percent of vineyard acres (138,937 of 139,204) in the North Coast region are reported as unaffected by recent fires.

93 percent of wineries (950 of 1,025) are reported as unaffected by the fires in terms of structural damage or long-term impact.

99.5 percent of the total crop value was recovered (calculations based on 2016 crush report).

90 percent of affected wineries and grape growers reported that vineyards would not need to be replanted or replaced, and of those that do, most would be less than 10 acres.

71 percent of survey respondents reported an immediate drop in tasting room traffic compared to the same period last year, although this trend started to recover in November.

62 percent of respondents reported a drop in tasting room sales compared to this period last year.

50 percent of respondents reported that visitors from the San Francisco Bay Area increased or remained constant, while visitation from outside California and the U.S. was most affected.

75 percent of respondents noted online sales are equal to or higher than in this period last year.

In the affected areas, vineyards often served as firebreaks that prevented the spread of fire, which is considered a primary reason for the limited damage. The reduction in visitor traffic and tasting room sales is thought to be the result of inaccurate national news reports and subsequent public misperception that a large portion of the wine region was damaged or closed due to wildfires. Beginning in November, this trend reversed with visitor numbers returning to or exceeding prior year numbers for the same period. Other wine regions in the state reported a significant increase in visitor numbers during this period.

Early indicators contributing to a positive outlook for broader economic recovery include timely insurance payouts, an expedited process and reduced government fees for building approvals, and property tax reassessments. An anticipated construction boom is expected to drive growth in employment and related sectors. Additionally, over $15 million in charitable contributions have been made through Redwood Credit Union and other channels in support of those directly impacted by the fires.

In phase two of the study, the Wine Business Institute will convene an industry working group for additional quantitative and qualitative analysis. It will include representatives of the California Wine Institute, California Association of Winegrape Growers, faculty from the Department of Viticulture and Enology at the University of California, Davis, and grower and vintner organizations throughout the North Coast.