A new study on the cost and returns of producing winegrapes in the North Coast region’s Russian River Valley, an American Viticulture Area in Sonoma County, has been released by the UC Agricultural Issues Center and the UC Davis Department of Agricultural and Resource Economics.
The cultural practices described represent production operations and materials of a well-managed vineyard in this region. The costs, materials and practices shown in this study will not apply to all farms. The production focuses on two varieties, chardonnay and pinot noir. Growers, UC Cooperative Extension farm advisors and other agricultural associates provided input and reviewed the methods and findings of the study.
The hypothetical vineyard was established with the appropriate permits required by the County of Sonoma at the time it was developed and assumed to lie in the warmer edge of the Russian River Valley. The farm is owned and operated by the grower. The site has less than a 15 percent natural slope. In reality, production is strongly influenced by the vineyard’s specific location within the valley and by weather that will significantly impact yield in some years. A vineyard management company is contracted to provide services such as specialized equipment and operators, and laborers for hand operations such as suckering, shoot thinning, tucking, harvesting and pruning.
The authors describe the assumptions used to identify current costs for production of the winegrapes, material inputs, cash and non-cash overhead. Ranging analysis tables show profits over a range of prices and yields for each variety. Other tables show the monthly cash costs, the costs and returns per acre, hourly equipment costs, and the whole farm annual equipment, investment and business overhead costs.
The new study is titled “Sample Costs to Produce Winegrapes, Chardonnay and Pinot noir, North Coast Region Russian River Valley, Sonoma County – 2016.”
Free copies of this study and other sample cost of production studies for many commodities are available. To download the cost studies, visit the UC Davis Department of Agricultural and Resource Economics website at http://coststudies.ucdavis.edu.
The cost and returns program is funded by the UC Agricultural Issues Center, which is part of UC Division of Agriculture and Natural Resources, and the UC Davis Department of Agricultural and Resource Economics.