Grape Growing During Prohibition
When prohibition was announced it had a marked effect on American grape growers. Doom and gloom pervaded the grape growing industry as growers reflected on the negative effect this would have on their incomes. Grape growers considered all their options and the general view was that the industry was finished and new sources of income would have to be found. Most grape growers ripped out their vines and replanted substitute crops.
The nett effect of large numbers of grape growers ripping up their vines was to decrease the availability of grapes to the market. Because there was still a demand for grapes despite prohibition, the price of grapes started to rise and it continued to rise as demand increased.
Growers who still had vines made enormous profits due to the lack of competition. Former growers realizing their mistake hastily replanted vineyards but instead of replanting only their former acreages they purchased additional blocks of land and expanded their holdings.
Vineyard acreages increased significantly and as the new vineyards started to produce, the price of grapes began to fall until it dropped below the pre-prohibition prices, with a devastating effect on prices of grapes and land.
Students of history will recognize that this scenario of market supply and demand constantly repeats itself and yet farmers in particular always seem to get caught out, as did the grape growers of California in particular. Despite massive promotion the grape growing industry struggled for many years.
Click here to read more about grape growing in the 1920’s and why demand for grapes increased during prohibition.
Leave a Reply
You must be logged in to post a comment.
