Crop question marks
The Northern Hemisphere’s 2023 crop picture appears mixed. With vineyard development running 2-4 weeks behind normal in California, and mildew pressure high, it remains too early to estimate crop size there. Mildew has also been a significant issue in Bordeaux and in central and southern Italy, contributing to expectations of shorter crops in those regions.
The French crop size otherwise appears good, likewise northern Italy’s. Meanwhile, May and June rainfall helped protect Spain from the subsequent heatwaves. Prices have risen in Italy mainly due to seller speculation and not – yet – the result of a demand uptick. Prices elsewhere are stable or negotiable. Any uncertainty about 2023-vintage volumes has failed to stimulate buying activity.
Rising pessimism
News from the Northern Hemisphere vineyards currently feels like it is commanding less of the conversation than is normal for the time of year. What dominates is rising pessimism, not only about the short-term economic squeeze but the long-term drift away from wine consumption in all mature markets, and the resulting rise in inventory levels. We are now 16 years past peak global wine consumption – in 2007 – and the downward trend in volume demand since then is starting to be felt in eroding sales numbers and industry confidence.
We are now 16 years past peak global wine consumption – in 2007 – and the downward trend in volume demand since then is starting to be felt in eroding sales numbers and industry confidence.
Red wine issue
Red wine is in a highly imbalanced supply-demand position globally and – of the major wine-producing countries – all but Italy, South Africa and New Zealand produce more of it than the whites favoured by younger demographics (if they drink wine at all). ‘Generation Z’ (aged 18-24) and ‘Millennial’ (25-39) consumers – interested in low and no-alcohol wines, natural or organic wines, canned wines, RTD wine spritzer drinks, and sparkling wines, enjoyed as just one part of a growing repertoire of alcohol drinks – are far harder to recruit with a standard EUR7.00 bottle of red than their parents and grandparents were.
Pockets of robust activity exist – for example, on Chile and Australia’s 2023 varietal white wines – but these are exceptions.
Opportunities
The bulk wine market’s ongoing slowness has opened up some attractive price-quality opportunities for buyers with routes to market and a brand vision. Some of these opportunities come along only rarely and some are multi-year.
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For the very latest and most detailed picture on pricing, knowledge which would enable buyers and sellers alike to make the best-informed decisions in the present low-visibility environment, don’t hesitate to get in touch with Ciatti directly. The broker team stands ready to help pair up suppliers with buyers.
