Supply chain bottlenecks give Napa Valley something to “vine”
Ongoing supply chain and shipping delays are giving Napa Valley business leaders something to “vine” as a cork shortage and rising costs choke the industry.
Portocork, one of the world’s largest wine cork harvesting and processing companies, has 138 million corks stranded at sea on shipping containers, according to its CEO.
But the most “enormous” pressure would come from rising shipping rates, with the cost of transferring a single container from Portugal to Oakland, California, rising from $2,500 to $14,000.
“The biggest challenge we face is just the shipping line,” Dustin Mowe told Kelly O’Grady of FOX Business, “and then tremendous pressure to be able to say to customers, ‘Sorry, we can’t ship for another month or several weeks.'”
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Mowe noted that without the ability to provide wineries with their cork inventory, it could impact national supply.
“This has a huge impact on our ability to supply,” continued Portocork’s CEO.
Recent shutdowns in China are also raising global market and labor concerns, further endangering Napa Valley’s $34 billion wine industry.
In addition to supply chain disruptions, the US wine country has also experienced shortages of bottles, seeds, fertilizers and worsening drought over the past year.
“It’s millions of dollars of investments that these people have made over many generations, so hopefully it will be resolved soon,” said Dr. Kaan Kurtural, a viticulture specialist at the University of California Davis, previously said on “Cavuto: Coast to Coast.”
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Some winemakers and distributors have decided to leave California altogether and take on Midwestern wineries, like Hoffman Family of Companies founders David and Jerri Hoffman, who hope to invest $100 million to transform the relatively small Missouri wine region. into a tourist destination.
“We’re very excited about what’s happening and how quickly we’ve been able to assemble these vineyards,” Hoffman told FOX Business’ Grady Trimble last May. “We think people locally have responded very well, and we see an opportunity to consolidate the vineyards and produce our grapes and distribute them nationally. »
Talia Kaplan and Sumner Park of FOX Business contributed to this report.