- Prices for bulk red wines in Australia remain low, affecting the rest of the market.
- The harvest in the southern hemisphere shows a mixed picture with some weather caprices.
Activities can be found around Sauvignon Blanc and Vin de France white in southern France, most whites and sparkling bases in Italy, and Sauvignon Blanc and Chardonnay in California’s Central Valley. Demand outside these items and areas remains largely lukewarm.
The ultra-competitive price of Australia’s bulk red wines in response to the fall-off in Chinese demand has started to affect the wider bulk market in recent months. Chile has received indications from North American buyers of reduced bulk needs from the 2023 vintage onward, and indeed Australia’s wine exports to the US were up 14%, and to Canada up 26%, in the 12 months to 30th September. With Australia’s new, 2023 vintage just a few months away, this is a trend likely to continue for at least another year.
Australia’s greater competitiveness impacts not only important rival suppliers of reds such as Spain, Chile and Argentina, but also of whites such as Chile (again) and South Africa, as Australia can offer whites in package deals. Softening prices in an inflationary environment is never easy for suppliers, and it may be that input costs have to curb significantly before they entertain the idea. In the meantime, unless it suffers a significantly short 2023 crop, Australia will make some headway into the market share of its rivals.
Crops in the South
What of the coming 2023 crops in the Southern Hemisphere? The springtime picture is mixed. La Niña has brought higher than average rainfall to Australia and there has been flooding in Central Victoria; South Australia is on flood alert. South Africa’s Western Cape has experienced a drier spring than Australia, that is for sure, but some thundershowers have topped-up already-decent dam water levels. Spring weather in Chile has been changeable, with an unseasonably cool start, followed by a heatwave, then some hail in several parts of the Valle Central on 12th November. The most dramatic news comes from Argentina, where the growing areas have experienced three frost episodes since the start of October, pausing the bulk market, which was proceeding cautiously anyway. Offers are on hold until the damage is better understood: consequently, this month’s Ciatti Global Report omits an Argentina price grid.
The bulk wine trade heads to the Amsterdam RAI convention centre for the 14th World Bulk Wine Exhibition on 21-22 November. While the 13th iteration went ahead in person last year, this year’s will be the first fully post-pandemic show in which the Northern Hemisphere is able to exhibit its freshly-crushed vintage.
Ciatti will be out in force at the WBWE and you can come see us on Stand C42-44. Whether or not you are attending the WBWE, get in touch – Ciatti stands ready to draw on its decades of experience to help wine suppliers and buyers harness the market’s latest opportunities.