As the new year begins, we at Ciatti wish all of our friends, clients and business associates a very happy and prosperous year ahead. Thank you for your continued support.
2020 is the first year of a new decade and – as designated by the United Nations – the International Year of Plant Health. Winegrape growers in Argentina, Chile, Australia, New Zealand and South Africa will be hoping their vines feel the good vibes and offer up high-quality yields in the coming weeks, with the Western Cape in particular hoping for a healthy-sized crop after two harvests short enough to send bulk wine buyers looking elsewhere.
The respective harvest pictures in the Southern Hemisphere will be clearer in February. Until then, we review the year just gone and look ahead to what 2020 could bring. The abiding characteristic of 2019 was a relative market calmness brought about by what the OIV called “very high” 2018 yields which markedly increased the global supply of wine just at a time when consumption in many traditional markets appears flat at best, Brexit uncertainty persisted, and a demand slowdown in the key growth market of China continued.
It’s worth looking back over the changes – or lack of them – in the decade just ended. The OIV estimated world wine production at 262 million hectolitres in 2010 and this continued stably during the course of the decade except for spikes in 2013 (291mhl) and 2018 (279mhl); global consumption in 2010, meanwhile, was estimated at 239 million hectolitres and it hovered around this figure during the decade (coming in at 244mhl in 2017), presumably as developing markets – such as China – offset flat or falling per capita demand in traditional markets.
The relatively steady global supply and demand hides churn – the rise in transporting wine in bulk, for example, the proliferation of private/supermarket label programs in some markets or the growth in organic wine demand – but in an industry where there is no consistent consumption uptick, globally-speaking, it can be about identifying the right wines for the right markets at the right times.
The first week of 2020 saw the sad passing of French wine merchant Georges Duboeuf at the age of 86. Using his eye for marketing and events, Duboeuf was credited with turning Beaujolais Nouveau – a drink once handed out for nothing on village streets in France’s Beaujolais region – into a major money-spinner, so that by the peak of the Beaujolais boom in the late 1980s he was selling more than 250,000 cases a year. Restaurateurs around the world competed to be the first to take delivery of the new vintage. The UK was for a time a very big market for Beaujolais Nouveau; recently, Japan has become the biggest importer, something that will only be helped by the EU-Japan FTA which entered into force last year.
Duboeuf’s entrepreneurial example, set thirty years ago, is just as relevant today for a wine industry needing fresh innovation to move it forward in the new decade. Ciatti is there to help you every step of the way in 2020 and beyond – just give us a call. Happy New Year!