The global bulk wine market in the first six weeks of 2024 was active, albeit relative to the market’s sluggishness in the second six months of 2023. Prospective buyers have been eager to discuss pricing and availability on South Africa’s coming 2024 wines considering the country’s 2023 inventory is now minimal; loadings have proceeded steadily in Italy, with Pinot Grigio and Prosecco in good demand; Chile received Chinese business in January and enquiries from around the world amid some softened prices; more transactions might have occurred in Spain if pricing had not risen in response to an initial demand uptick stimulated by the shorter crops there and in Italy.
Chile and Spain’s contrasting fortunes illustrate that demand is often pricesensitive, not absent altogether. Many bulk wine buyers remain choosy on price, quality, and volume, and believe they can afford to be, given the inventories available. But having bought less or even not at all in 2023 – as distributors and retailers spent the year right-sizing their inventories – buyers may have greater need in 2024 and market activity could be steadier at the right price, especially if improved consumer sentiment in North America and Europe translates to increased discretionary spending.
The Southern Hemisphere’s 2024 harvests are now getting underway and early expectations in Argentina, Chile and South Africa are for average to belowaverage crops; in Australia, some early inland grapes have come in below the average. As well as Mother Nature, what must be taken into account when forecasting this year’s crops is cost-conscious producers having conducted their own right-sizing exercises, whether that be holding back from new plantings, leaving vines unpruned or unsprayed unless/until they are contracted, not picking uncontracted grapes, or uprooting vines altogether.
Not only buyers but suppliers are highly price-sensitive as they seek to offset some shorter crops and cover elevated input and winemaking costs. As shown by the current restiveness among the agricultural industries of Europe, “fair prices” can be a highly sensitive issue when business survival is at stake, and in this the wine industry is no exception. As outlined in this month’s ProWein Preview, the fair’s latest state-of-the-industry report found that only 6% of responding producers saw their profits rise in 2023, versus 60% whose profits declined.
Identifying sourcing and selling opportunities that provide margin and cashflow, and building buyer-seller relationships for long-term security: this is where Ciatti can bring its decades of knowledge and experience to bear. Don’t hesitate to get in touch and, in early March, you can come see us in person at ProWein on stand H60 in Hall 14. In the meantime, read on for detailed updates on each market.