As the end of 2024 approaches, we are able to look back over a year on the global bulk market that was, despite common perception, different from its predecessor. December 2023’s Global Report began: “A year of flat or declining wine sales owing to consumer pessimism draws to a close with bulk markets exhibiting the same slowness they have done throughout the previous eleven months.” But the bulk market of 2024 has reassumed something of its traditional character, i.e., with activity levels differing between supplier countries, very crudely summarised as follows: short and active (Chile, Italy), long and less active (California, France), elevated in price therefore less active (Spain, Argentina), steady (Australia), and very low on stock (South Africa).
The main cause of any activity upswings and/or elevated prices has not been increases in retailer/distributor demand – which has remained patchy – but two consecutive years of lighter crops: the OIV’s estimates of world wine production in 2023 (237 million hectolitres) and 2024 (a mid-range projection of 231 million hectolitres) are well down from the 2018-2022 average of 267 million hectolitres and would be the smallest output since the early 1960s. Climatic conditions were an important factor, but there have also been vineyard removals – particularly in France, California, Australia, and Chile – and other, less quantifiable steps taken by growers to keep spending to a minimum during a time of high costs and slow sales: mothballing vines, farming minimally, leaving grapes unpicked.
Ultimately, until consumption stabilises – wine’s retail sales volumes in major markets such as the US, UK and France continued to fall in 2024 – wine needs will often be incremental, fewer grapes will be required, and vineyard surface will shrink. Ongoing consumer pessimism (dubbed a “vibecession” but at least partly a reflection of earnings growth lagging 2021-23 inflation), demographic change, health messaging and proliferating alternative products are not going away in 2025, but the painful supply adjustments the wine industry has been undertaking over the past two years should help ensure it is better placed to meet the incremental, just-in-time buying activity that is becoming the norm.
The markets for white wines in Italy and Chile have been busy, with pre-harvest contracting of Chile’s 2025 varietal whites already well-advanced following the short 2024 crush. Varietal and generic white supply feels balanced globally, given South Africa’s lack of stock. For every area of balance, there are currently many areas of opportunity – for example: 2023 Marlborough Sauvignon Blanc (now priced competitively with New Zealand GI Sauvignon Blanc); 2024 southern French Pinot Grigio (price-competitive with Italy’s); higher-end Californian and Chilean wines (for mid-tier programmes); Argentinian Malbec (reduced in price by 20% through 2024). Buyers interested in harnessing such opportunities and seeking quick sampling, bottling and loading should get in touch with the Ciatti team, who possess the very latest local and international perspectives and able to draw upon a global network of regional offices. In the meantime, read on for our final market updates of 2024 and may your Holidays, and 2025, be happy and prosperous.