Strategic Development of a Competitive Grape Industry in Nevada

Recipient Organization
UNIVERSITY OF NEVADA
(N/A)
RENO,NV 89557

Performing Department
RESOURCE ECONOMICS

Non Technical Summary
An assessment of the economic feasibility requires a market assessment and the development of a model of production costs for Nevada for each grape variety. The overall object of the research is to develop a model of the demand and supply of grape varieties that may be successfully grown in Nevada so the competitive position of prospective vineyards in Nevada can be determined.

Animal Health Component

50%

Research Effort Categories

Basic

40%

Applied

50%

Developmental

10%

Classification

Knowledge Area (KA)	Subject of Investigation (SOI)	Field of Science (FOS)	Percent
601	1131	3100	25%
603	1131	3010	75%

Knowledge Area
601 - Economics of Agricultural Production and Farm Management; 603 - Market Economics;

Subject Of Investigation
1131 - Wine grapes;

Field Of Science
3010 - Economics; 3100 - Management;

Goals / Objectives
The objective of this research is to determine which grapes varieties can be profitably grown in Nevada.

Project Methods
The approach will be to employ econometric modeling procedures to develop a demand supply model that incorporates the varieties of grapes into the model. The estimated market clearing prices under a range of freeze and water conditions will be simulated. The simulated market process, by variety, will be compared with the cost of producing the grapes and the expected net present value will be calculated.

Progress 07/01/02 to 06/30/05

Outputs
The analysis develops a method for assessing the expected profitability of wine grapes in Nevada. It focused on the profitability of replacing alfalfa with either Chardonnay or Cabernet Sauvignon grapes. It finds that either grape is clearly more profitable that alfalfa.

Impacts
The project shows which grape varieties are more profitable to grow in Nevada than alfalfa.

Publications

No publications reported this period

Progress 01/01/04 to 12/31/04

Outputs
Complete data on more than 40 varaieties of grapes used to make wine have been obtained. Preliminary analytic models have been develop and are being fit to the data.

Impacts
This analysis will provide information to growers in Nevada that will allow them to assess the profitability of different varieties of grapes and to determine the rates of capitalization needed by grape variety.

Publications

No publications reported this period

Progress 01/01/03 to 12/31/03

Outputs
Price and quantity data for Oregon and California by grape variety have been gathered and prepared for analysis. More than forty individual varieties of grapes have been examined. The data is broken down by year and county to acomodate microclimates in the wine growing areas of the two states. Preliminary econometric anlaysis of the Oregon data has been undertaken and is being compared with results of the California analysis. Following the completion of the Califronia analysis an assessment of the financial feasiblity of growing bulk vitological grapes in Nevada will be completed.

Impacts
This anlaysis will provide informatio to growers in Nevada that will allow them to assess the profitablity of different varieties of grapes and to determine the rates of capitalization needed by grape variety.

Publications

No publications reported this period