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Estimating the Value of California Wine Grapes*

Published online by Cambridge University Press:  08 June 2017

Olena Sambucci  and
Julian M. Alston
Olena Sambucci*
Affiliation:
Department of Agricultural and Resource Economics at the University of California, Davis, One Shields Avenue, Davis, CA 95616
Julian M. Alston
Affiliation:
Department of Agricultural and Resource Economics at the University of California, Davis, One Shields Avenue, Davis, CA 95616; email: julian@primal.ucdavis.edu.
*
email: sambucci@primal.ucdavis.edu (corresponding author).
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Abstract

The California Grape Crush Report (Crush Report) is an authoritative source of information on production and returns per ton by variety of wine grapes that includes summaries of quantities produced and estimates of the average prices and value of wine grapes crushed in California. The data provided in the Crush Report are used to calculate the total value of wine grape production as reported in the annual Agricultural Statistics reports published by the U.S. Department of Agriculture and in major industry publications. We use the differences among crush districts in the shares of production crushed to growers’ accounts to show that the current mechanism of calculating average statewide returns per ton understates the true total value of the crush by 14 to 20 percent. We show that a more accurate estimate of the total value and average price can be obtained if the prices of the wine grapes that are sold are used to infer the prices of wine grapes that are not sold before computing the weighted averages. (JEL Classifications: Q20, Q11, Q13, Q19)

Keywords

California grapesgrape crushwine grape industrywine grape prices
Type
Articles
Information
Journal of Wine Economics , Volume 12 , Issue 2 , May 2017 , pp. 149 - 160
Copyright
Copyright © American Association of Wine Economists 2017 

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Footnotes

*

The work for this project was partly supported by the National Institute of Food and Agriculture, U.S. Department of Agriculture, under award number 2011-51181-30635 (the VitisGen project) and award number 2015-51181-24393 (the Efficient Vineyard project). The authors are grateful for this support. We thank Daniel Sumner, the editor, and an anonymous referee for helpful comments and suggestions.

References

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