COVID-19 fallout hits California’s wine grape growers and wineries
Monday, March 30, 2020
Amid the COVID-19 pandemic, California Gov. Gavin Newsom on March 19 ordered the state’s residents to shelter at home and for bars and restaurants to close.
There are other related impacts. Take agriculture, a top industry in the Golden State, with grapes the second biggest market commodity at $6.25 billion versus dairy products and milk at $6.37 billion in 2018, according to government data.
“The COVID-19 pandemic presents incredible and unpredictable challenges,” Michael Miiller, director of government relations for the California Winegrape Growers Association, told MultiBriefs via email. “Growers are already facing the challenges of a glut of grapes in the market.”
As weak demand relative to market supply hit the business before COVID-19, there have been other obstacles. One is a drop in labor force participation, and the other is a spike in the price of regulatory compliance, according to Miiller.
A shortage of workers, all things equal, increases their bargaining power with employers who can, in response, raise wages to attract new hires.
“Growers and agricultural workers are resilient and confident people,” said Miiller. “This industry will deal with each challenge as they are presented. We are all in this together.”
The Wine Institute is a group of 1,000 wineries in the Golden State, heeding the governor’s order. “California wineries have suspended all public tastings and events,” a statement from the group read. “While essential winery and vineyard production and business operations as well as purchase and pick-up of wine are permitted, this directive presents challenges for the state's predominantly small, family-owned operations.”
Meanwhile, President Trump signed The Coronavirus Aid, Relief, and Economic Security Act after the House passed it on March 27. The $2 trillion stimulus has $350 billion of loan guarantees, subsidies and other funding from the Small Business Administration, with pending legislative and policy measures to facilitate the aid. The process could take a month to finish fully.
Almas Sayeed is the deputy director of programs with the California Immigrant Policy Center. “The CARES Act, the largest relief package for families ever approved by Congress, excludes farmworkers, most of whom are undocumented,” she told MultiBriefs in an email. “Farmworkers, those who help grow, harvest and gather our food, continue to work through the wave of COVID-19 infection. In this moment, they are in the crosshairs of COVID-19 infection, vulnerable to the risk of contracting it.”
Meanwhile, COVID-19 test kits are in short supply as the nation locks down to slow the spread of the pandemic. That is not all. According to CPIC’s Sayeed, the CARES Act “excludes undocumented immigrants from free testing, does nothing to expand health insurance protection to this community and excludes undocumented immigrants from the tax rebate. The decision to exclude many, including farmworkers working on the front line to ensure others have healthy and nutritious food while they lack access to health care, is not only immoral, it's bad policy.”
John Newton, Ph.D., chief economist for the Farm Bureau, and the United Farm Workers labor union, declined requests for comment.
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