(Reuters) - U.S.
consumers are going to be faced with a choice this year: pay more for a
bottle of domestic wine, settle for lower quality, or buy cheaper
imports, the Silicon Valley Bank forecast on Tuesday.
SVB, a commercial banker to the
wine industry, said in its latest "Annual State of the Wine Industry
Report" that it expects vintners to raise prices as the supply of grapes
declines and evolves "into a state of shortage that will last for some
time domestically."
"We hope you
stocked up on a few cases because reality is knocking at your cellar
door ... inventories are now starting to run to the short end of the
scale, and bottle prices will start to increase in 2012," the report
said.
Prices for California wines
will be the first to rise, followed by wine from Oregon and Washington
State, according to the report.
SVB has also cooled on European wines. It forecasts that prices for European wines, especially those from Spain and Portugal, should decline.
While
SVB predicts 2012 sales growth for the industry at 7 percent to 11
percent, a slight drop from 2011, it also foresees declining "wine
quality for the price paid, pushing consumers to decide if they are
willing to drink lesser quality domestic wines, or pay higher prices, or
find foreign substitutes."
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