Coronavirus and the Farm Economy

AgInfo / March 18, 2020

“You do have to think about it commodity by commodity. Which ones are most sensitive to income? Which ones aren’t? Let me just give you a quick example from the wine industry. […] So you could have the central valley wine industry be better off at the same time, the coastal wine industry is hurt. And we saw that in a recession 10 years ago.”

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Virus’ long-term impact will be mixed for ag, economist says

Western FarmPress / March 16, 2020

Production activities will continue, but California’s high-end wines and non-staple foods will take a hit.

Even in self-imposed isolation, people “are still going to eat,” which is why agricultural production in general “is not very income-sensitive,” said Dan Sumner, director of the University of California’s Agricultural Issues Center in Davis.

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AIC researchers present on cannabis economics at Cornell

On June 12, 2018, at the 12th annual conference of the American Association of Wine Economists at Cornell University in Ithaca, New York, AIC researcher Robin Goldstein organized and chaired a plenary session on “Cannabis and Opioid Economics.” The majority of the work presented in the session was AIC research.

Goldstein presented “Retail costs and price relationships for the 2017 California cannabis market,” joint work with AIC Director Dan Sumner and AIC undergraduate researcher Allie Fafard. Sumner presented research with Yolanda Pan on “Simulating impacts of legalization and regulation of cannabis on the retail market,” and also discussed ongoing work on cannabis testing costs, joint with AIC researcher Pablo Valdes-Donoso and Goldstein.

The panel also featured the eminent economist Orley Ashenfelter of Princeton University, Guggenheim Fellow and past president of the American Economic Association, who presented “Opioids and alcohol: Substitutes or complements?”, and James Eaves (University of Laval), whose presentation, “Is cannabis like wine? The user experience offered by some popular cannabis strains,” focused on the economics of the Canadian cannabis market.

“Do More Expensive Wines Taste Better?”

AIC researcher Robin Goldstein recently had a chapter published called  “Do More Expensive Wines Taste Better?” in Volume 1 of Handbook of the Economics of Wine

Handbook of the Economics of Wine
(In 2 Volumes)

Volume 1: Prices, Finance, and Expert Opinion
Volume 2: Reputation, Regulation, and Market Organization

Edited by: Orley Ashenfelter (Princeton University)Olivier Gergaud (KEDGE Business School, France)Karl Storchmann(New York University, USA)William Ziemba(UBC & London School of Economics, UK)

Should California winemakers be worried about China’s tariffs?

The Conversation 4/10/2018
Authors: AIC Director Daniel A. Sumner, Julian Alston, Olena Sambucci

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“California’s vintners and grape growers are among the latest potential victims in the escalating trade spat between the U.S. and China.

Responding to U.S. plans to impose import duties on goods from China, the Chinese Ministry of Commerce reciprocated by introducing new tariffs on 128 U.S. products, including an additional 15 percent import tariff on wine.

Wine producers in California are concerned about the immediate and longer-term implications of this new tariff, on top of those already in place. Reports have already begun to circulate about orders being canceled, redirected or renegotiated as a result.

How worried should U.S. winemakers be?”

If China Strikes Back On Tariffs, California Tree Nut Exports Could Take A Hit

Capitol Public Radio   3/27/2018

“If China hits the U.S. with a 15 percent tariff on wine, that’s a problem, explains Dan Sumner, Director of the University of California Agricultural Issues Center. “We may think California wine is special, but not everybody does,” Sumner said…”

Clearing the Air: Smoke taint and the aftermath of the California wildfires  1/23/2018

“There isn’t a clear answer as to how much of the 2017 harvest was affected, but Jim Lapsley, researcher at the Agricultural Issues Center at UC Davis, says number crunching gave him a clue: “The three-year average yield in Napa County of tons of all grapes was about 151,000 tons. Assuming 10 percent—or 15,100 tons—wasn’t harvested [before the fire] and was all Cabernet Sauvignon, Napa’s three-year average Cabernet harvest was 63,205 tons, so the hypothetical 15,100 tons would represent about 24 percent of Napa’s Cabernet harvest.”

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Sonoma winery with UW ties gauges effects of wildfires  11/27/2017

James T. Lapsley, a researcher at the University of California’s Agricultural Issues Center, where he studies economics regarding grape and wine production, wrote in an email that there’s a lot that is not known about smoke taint. But “one experiment shows that even 30 minutes of exposure can result in measurable compounds. Personally, I think that grapes that received several days of heavy smoke will have problems.”

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That unsold bottle of Merlot is probably winding up in your gas tank  11/27/17

Overproduction, due to the long lead time involved, is a notorious problem in the wine industry, according to Robin Goldstein, author of The Wine Trials and Principal Economic Counselor at the University of California Agricultural Issues Center, who has long studied wine economics and trends. According to Goldstein, “It’s always been a risk factor and cost of doing business,” and it’s becoming more difficult all the time.

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Your $100 Bottle of Cabernet Sauvignon Just Got More Expensive  November 22, 2017

“Less than 1 percent of the winemaking capacity burned,” said Daniel Sumner, economist and professor at University of California, Davis. “The interesting thing we’re looking at now and what people should recognize is that the grapes that hadn’t yet been harvested, tended to be the highest price Cabernet Sauvignons.”

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