Monday, September 17, 2018

The number of wineries in the USA

We all know that the number of wineries in the USA keeps increasing, but few people know just how many there are, or how rapidly the number is increasing. Well, this is precisely the sort of thing that the government likes to keep a track of, and they do not hide the information from us.

The data in the following graph come partly from the U.S. Tax and Trade Bureau (Bonded wine producers count by state: 1999–2018) and partly from the Wine Institute (Bonded wineries — data prior to 1999). To make this clear: "Bonded winery premises include every licensed production facility of single firms or individuals, licensed warehouses, experimental wineries and wineries with no casegoods production or fermentation capacity." That is, pretty much everything.

Number of US wineries through time

So, that makes 12,573 facilities as of June 30 2018. This is one winery for every 30,000 persons in the country.

There was a decline in number from World War II until 1965, presumably also still reflecting both Prohibition and the Great Depression. However, from 1970 there has been an exponential increase in the number of wine facilities, as shown in the next graph.

Fit to the exponential model of the number of US wineries through time

The exponential model fits very well, which means that the rate of increase is itself increasing each year. Indeed, the number of wineries is multiplied every year by c.1.07 (on average, each year there is an increase of 7% over the previous year). It is not obvious how long this rate of growth can be maintained, since there is a finite amount of land area on which to construct these facilities. However, it has been going on for a half-century now, with no sign of abating.

Obviously, not every year has exactly the same increase, as shown in the next graph, which simply shows the annual change in number.

Annual change in the number of US wineries

First, note the apparent boom between 1975 and 1980. This is an artifact — it is the accumulated number of new facilities over 5 years (341), not just 1 year (presumably, c.70 per year). Second, the apparent boom in 2011 also looks like a possible artifact — the preceding decline, plus the boom, looks like there were a whole lot of new facilities that were not recorded during 2008-2010, which were then included in the 2011 census. However, this same pattern is repeated across all of the states, as shown (in green) for California in the next graph. So, whatever it was that caused this was widespread.

Annual change in the number of California wineries

Speaking of California, it is appropriate to finish with a consideration of how the biggest wine-producing state fits into the national pattern. This is illustrated in the final graph, which shows the number of California facilities as a percentage of the national total.

Percentage of US wineries that are in California

Note that the increasing dominance of the California industry until 1965 (reaching 57%) coincides with the general decline in the national number of wineries. This maximum percentage was maintained until 1984, after which there was a rapid rise in winery numbers elsewhere — that is, until 1986, the number of new facilities outside California grew more rapidly than the number inside. Things steadied after that, with the increase in numbers both inside and outside California keeping pace with each other until the end of the century.

However, the last time California had more than 50% of the US wineries was in 2001; and its dominance has steadily decreased since then. Nowadays, people are simply setting up more facilities outside California than inside it — after all, there is a lot more potential vineyard land outside. Presumably, this trend will continue for the foreseeable future.