Direct Shipping from Wineries to Homes During Pandemic Is Breaking Records, But Not in New Jersey

Restrictive State Law Limits Consumer Wine Choices;

Hearing on Relief Measure October 8

TRENTON (October 7, 2020) — As consumers across the nation face pandemic-induced limits on travel, dining and shopping, shipments of wine direct from wineries to homes is at the highest levels ever – but not in New Jersey. Residents have far less ability to get wines shipped direct from licensed wineries because of a needlessly restrictive state law.

Though New Jersey is the sixth largest wine-consuming state, it ranks only 17^th in the value of wine shipped directly from wineries to consumers, lagging far behind other, smaller states. In the first half of 2020, winery-to-consumer shipments increased by nearly 1 million 12-bottle cases across the nation — or 29% — compared to the same period in 2019. In New Jersey, shipping volume rose by just 9%. The value of shipments nationwide was up 15%, or $222 million. In New Jersey, value rose by only 11%, to $24.6 million. The figures come from Wines Vines Analytics/Sovos ShipCompliant, two organizations that jointly produce data on direct-to-consumer wine shipping.

“Based on total consumption, New Jersey is clearly home to millions of wine-loving consumers, but these people don’t have the same level of choice as wine drinkers in other states,” said Andrew Adams, editor of Wine Analytics Report, which tracks DtC shipments on an annual and monthly basis. “While DtC shipments did grow, this really was a lost opportunity for wine drinkers in New Jersey to have shipped to their homes the full range of wines they may have been buying in restaurants and bars prior to the pandemic,” Adams said. Industry analysts predict the direct-to-consumer shipping trend is likely to continue to increase nationwide after the pandemic is over.

DtC shipments are one of the strongest and fastest growing segments of the U.S. wine business. In August 2020, shipment value was up 29% over August 2019, to more than $177 million, and volume was up 32% to more than 472,000 cases.

The reason for New Jersey’s weak numbers is a state law passed in 2012 that arbitrarily bans U.S. wineries producing more than 250,000 gallons a year (about 106,000 cases — a medium-sized winery) from shipping to New Jerseyans’ homes and offices. Only wineries making less than that amount are allowed to direct ship. This “capacity cap” limit applies to both in-state and out-of-state wineries. It denies New Jerseyans direct-shipment access to more than 90% of wine made in the U.S. New Jersey and Ohio are the only states with a capacity cap; similar restrictions were removed in Massachusetts and Arizona.

Bipartisan legislation introduced in both houses — S 2683 and A 1943 — would eliminate New Jersey’s capacity cap and give consumers the range of choice enjoyed in other states. A discussion-only hearing on the measure is scheduled for the Assembly Oversight, Reform and Federal Relations Committee, Thursday October 8 at 9:15 am. You can follow the hearing online here.

“During the COVID-19 pandemic, direct shipping from wineries to consumers is breaking records, but New Jersey’s law prevents many wineries from fulfilling  growing demand in this state,” said Jeremy Benson, executive director of Free the Grapes, a national grassroots coalition of wine lovers and wineries who seek to remove bans and streamline restrictions. “With the restrictions COVID places on restaurant sales, retail sales and travel, now is the time to address this archaic restriction on consumer access and give New Jersey consumers the convenience that others enjoy,” he added.

Free the Grapes encourages consumers to visit its website and take two minutes to urge their legislators to eliminate the capacity cap and expand choice in New Jersey.