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Exports of U.S. wine reach record $876M; most from California

They seem to like us over there.

That's one way of explaining why U.S. wine exports hit a record $876 million last year, according to The Wine Institute. The vast majority came from California, much of it from the Northern San Joaquin Valley.

"I think the style of California wines is more popular around the world," Chris Indelicato, chief executive officer at Delicato Family Vineyards in Manteca, said Friday.

Other factors are at play, too. Indelicato noted that currency exchange rates favored U.S. producers last year, and a drought and cold snap reduced the amount of wine from Australia.

Whatever the reason, U.S. producers are getting more and more income from abroad. Annual export sales have increased 25-fold since the $35 million in 1986, institute records show.

"The growth is impressive considering the trade barriers that California wineries face in markets worldwide," said Bobby Koch, the institute's chief executive officer, in a news release.

The institute, based in San Francisco, used U.S. Department of Commerce figures in its report issued Wednesday.

The group represents makers of California wine. Most of the higher-priced bottles come from grape-growing regions near the coast, but the San Joaquin Valley is a big contributor because of sheer volume.

A continued influx of money from abroad would be a boon to the valley economy, where several thousand people work for wineries and for the companies that supply them.

E.&J. Gallo Winery, the world's second-largest by number of cases sold, has customers in about 90 countries for its many labels. Exports are crucial to two other giants in the area — The Wine Group, which owns Franzia Winery near Ripon, and Bronco Wine Co. near Ceres.

Delicato is not in this size range, but it's still a major producer, thanks in part to exports to about 40 countries. Indelicato, grandson of one of the winery's co-founders, said growth has been especially strong in the United Kingdom, Canada, Japan, South Korea, China and Russia.

"As an industry, we are keyed up to have the same kind of year in '07 as we did in '06," he said.

The 2006 export sales figure is 30 percent higher than the previous year, but the institute pointed out that 2005 was unusually low because some U.S. wineries shipped a lot of bulk wine abroad, receiving less than they get with bottles.

"Nonetheless, the long-term trend of California wine exports shows steady expansion in all major markets and growth in new, undeveloped markets," said Joseph Rollo, director of the institute's international department, in the news release.

The report estimated that 106.9 million gallons of wine was exported by U.S. wineries last year. That's slightly up from 102.5 million the year before, but far less than the record 121.9 million in 2004.

On the Net: www.wineinstitute.org. To submit items to From the Vine, call 578-2385, send a fax to 578-2207, or send an e-mail to jholland@modbee.com.

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