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From Tariffs To Cannabis, Napa Valley Vintners Take On New Challenges

October 18, 2019

Formed 75 years ago this month, the Napa Valley Vintners (NVV) trade group now includes 550 wineries representing 99% of Napa Valley wine production. Totaling about 9 million cases annually, Napa Valley accounts for only about 4% of California’s production, but it remains the most prestigious growing region in North America and the calling card for American wines around the world. SND executive editor Daniel Marsteller recently met with Napa Valley Vintners president and CEO Linda Reiff to discuss the state of play for Napa wines and what the future holds.

SND: What are you hearing from NVV members as to the biggest challenges for the Napa Valley wine business moving forward?

Reiff: Right now one of the biggest concerns and a very timely topic is the tariff issue. We’ve worked extremely hard to build export markets, and we’re far behind our European counterparts who have a couple of centuries’ head start on us. By comparison, we’ve been at it for only about 25 years. I was involved with the very first efforts to go into China and start working there. We’ve made a lot of progress, and have had a lot of members doing terrific business. To now have a 90% tariff and tax on our wines in China is outrageous, and highly damaging to brands that have worked hard to develop the relationships necessary to thrive in that market. We actually have a coalition of 26 winegrowing regions from around the world—the Wine Origins Alliance—arguing collectively against tariffs on the industry. We here in the U.S. are arguing that tariffs should not be put in place for our European counterparts. They are doing the same over there. We’re issuing letters to each of our respective governments and lobbying for the global wine industry as a whole. The bottom line is we’re tired of having wine being used as a pawn in trade wars.

SND: How is the overall health of the Napa Valley brand? What NVV initiatives have been particularly effective in promoting it?

Reiff: While Napa is only 4% of California wine, it accounts for 30% of economic value. I think that speaks to the power of the brand Napa. At Napa Valley Vintners, marketing and promotion is about 80% of what we do. We have over 80 different programs operating across the United States and in five to eight other countries in any given year. We recently hosted a group of trade from across Asia for our Experience Napa Valley program, a five-day immersive education session. Also, our Premiere Napa Valley event in February has become an anchor for high-intensity business between wineries, distributors, and other trade, with the whole industry descending on Napa.

SND: How does NVV’s membership view the emergence of cannabis as a consumer category, and specifically the prospect of plantings in the Napa Valley?

Reiff: There are really two issues in regard to cannabis. One is about access and one is about cultivation and manufacturing. The citizens of California spoke in favor of access, but they did not necessarily vote for cultivation and manufacturing right next door to their house. There was a ballot initiative that came forward on cultivation in Napa Valley. An independent analysis—an 80-page report—found a variety of potential challenges and problems that could arise from that. After seeing that report, we spoke up along with every other industry organization in Napa County, asking the board of supervisors to continue a ban on the commercial cultivation and manufacturing at Napa County for the time being.

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