California wine sales in U.S. hit $35.2 billion in 2017

California wine shipments in the United States reached an estimated retail value of $35.2 billion in 2017, up 3 percent from the previous year.

The state shipped 241 million nine-liter cases in the United States in 2017, up 1 percent.

California wine sales to all markets, including shipments to the United States and exports worldwide, were 278 million cases in 2017.

“Consumers in the U.S. and worldwide continue to trade up to higher-priced premium wines,” said Robert P. Koch, president and CEO of the Wine Institute. “The quality, selection and commitment to sustainability make California wines well-positioned for growth.”

“California wine sales in the U.S. market have grown 15 percent in the past decade from 209 million cases shipped in 2008 to 241 million cases in 2017,” said Jon Moramarco, founder and managing partner of BW166, and editor of the Gomberg-Fredrikson Report. “Last year the growth mainly came from premium wines priced over $10.”

According to Moramarco, demographic trends play a significant role in wine sales. While per capita consumption has been flat over the last decade, wine sales have grown in line with the legal drinking age population, which increased roughly 10 percent over the same time period.

Additional trends impacting sales included wineries focusing on tasting room and direct-to-consumer sales, which accounted for nearly $2.7 billion in retail value and 5.8 million cases in 2017.

Wineries also found opportunities in independent, local restaurants with wine menus listing limited production wines to appeal to consumers shifting their spending to these smaller eating establishments.