The global bulk wine market was largely quiet over the past month, with only Chile and Spain reporting steady activity. Prices in these two markets have risen in recent months in response to their respective shorter harvests and healthier – or at least perceptions of healthier – demand versus last year. Generic white wine is in tightest supply; this item and varietal whites spearhead demand, and the campaign for Spain’s 2024 whites is likely to commence quickly. An uptick in buyer enquiries has continued in California, potentially due to prices softening as the new crop nears, but only some of this activity has so far translated into deals.
The market is entering its traditional lull while the Northern Hemisphere enjoys its summer holidays. Current vineyard conditions suggest the overall crops in California, France and Spain are on track to be at least in the vicinity of their averages; only Italy – at the time of writing – is a concern, experiencing too much rain in the north (heightening disease risk) and too little in the south (where heatwaves have been extreme). It was Italy’s short crop last year that led to a tightening of the generic white wine market in Europe and beyond, which was then exacerbated by this year’s below-average crop sizes in Chile and South Africa. Buyer need has been created by pockets of shorter supply such as this, rather than any noticeably concerted uptick in retailer-distributor demand in key markets.
Trade tensions between the EU and China continue to escalate. Claiming “unfair subsidisation”, the EU has, as of 5th July, imposed extra import tariffs – of up to 37.6% – on electric vehicles from China. (China’s share of the EU market for electric vehicles has risen to 25% from 3% in 2020.) In retaliation to this and ongoing EU investigations into Chinese wind turbine and solar panel imports, China is carrying out anti-dumping probes into EU pork and brandy imports as well as the EU investigations themselves.
This is of great concern to the Cognac brandy business, but also Europe’s wine industry, which understandably fears it could be next. Chinese tariff hikes may not have the same impact as before: according to OIV statistics, wine imports into China have declined for six consecutive years and wine consumption there is estimated to have shrunk from 17.6 million hectolitres in 2018 to 6.8 million in 2023 (a factor in the downward trend in global wine consumption). But trade barriers are far from ideal during a period of market slowness, particularly for red wines.
The challenging market has opened up attractive one-year and multi-year opportunities on a wide range of quality wines for bulk and mid-tier programmes, from standard red and white varietals through to items such as declassified high-end French rosé, Marlborough Sauvignon Blanc, even cachet Coastal California appellations. Ciatti’s interconnected global network gives the company the ability to provide the most up-to-the-minute market information and the full spectrum of opportunities for buyers and sellers alike, and help it facilitate the just-in-time business model that is becoming increasingly common. Don’t hesitate to get in touch. In the meantime, read on for the latest from each market.