Bulk wine pricing around the world is generally in a stable to softening trend as a number of downward pressures on prices offset the upward pressure from elevated input costs: the stop-start nature of buying activity in most markets; some large inventory levels – primarily of reds – in Argentina, Australia, California and France; lower 2023 grape prices in Chile versus 2022; a larger than expected 2023 crop in New Zealand; Rand weakness in South Africa. It should be underlined that buying activity continues, but much of it is for short-term needs, with buyers seeking smaller volumes for quicker loading. 

The slow nature of most consumer sales channels in most countries has disincentivised the opportunistic buyers who might normally – especially with freight costs greatly reduced and logistics efficiency markedly improved versus a year ago – come into a long market and get creative with new brands. Instead, winery focus is on inventory adjustment, assessing which brands are distractions to profitability, and – in some instances – brand or wider business rationalisation. The assessment of this month’s California Report could easily apply internationally: “Wine and grape markets [are] shrinking overall, potentially leading to lower need for wine and grapes over time.” Vine pull-outs are back on the agenda in a number of producer countries. 

The California Report also outlines two contrasting potential responses from wineries to the current market dynamic. One is to discount pricing, which may boost sales in the short term but also reduce or remove margin in the long term. The other is to raise prices and invest in marketing – which may have greater cut-through now, when rival brands are reducing their own marketing spend – in order to grow a brand long term. However, this requires financial outlay, and few businesses are currently willing or able to do that. 

The real challenge for the global wine industry, as this month’s Italy page says, is to “reinvigorate the perception of wine as a daily part of a healthy lifestyle once again”. Such a change, if it can be brought about, is likely to take some time. Until then, many of the current growth areas seem to be to one side of the mainstream of the market: low- or no-alcohol wines, organic wines, canned wine (increasingly using and marketing with more premium, varietal and vintage specific wines such as “Loire Valley-2021-Viognier”), wine-based spritzer drinks (dovetailing the canned wine, sparkling wine and low-alcohol trends together), and wine-based cocktails (such as Sangria: see this month’s Spain page for more information). Canned wine cocktail/spritzers brands often make a virtue of their transparency (“Four simple ingredients: white wine 50%, sparkling water 40%, tonic 9%, natural lemon and lime flavours 1%”) to attract younger, health conscious consumers. 

Buyers with or without funky new products up their sleeve can currently find some excellent wines from a price-quality perspective on the bulk market – generic, varietal, conventional, organic, low-alcohol – with which to fulfil their brands in both the short and long term. Some specific wines are in low supply, and all suppliers are seeking to cover elevated input costs, so bulk prices – where they are trending softer – do not presage a race to the bottom. For the very latest buying and selling opportunities, get in touch with Ciatti direct; the team can draw on its many decades of experience to help you identify growth. In the meantime, read on for detailed updates on each market. 

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