Export growth of wine has slowed and will soon begin to dip on lower available supply from the 2012 harvest, the latest Rabobank wine quarterly says.
The impact had not been uniform across markets. While shipments to the UK, Europe and Australia are starting to slip, those to the US, Canada and China are rising.
Early indications were for higher supply this year from southern hemisphere producers and the growing season was shaping up to deliver a larger 2013 harvest in New Zealand.
Despite the anticipated recovery in production, the low level of ending stocks is likely to support grape pricing in the key Marlborough region, the report says.
In Australia, the extended heatwave that has affected much of the country from late December into January has the potential to moderate production from the 2013 harvest. Wine grape markets have been subdued but are likely to respond if the extreme conditions continue.
It appears Chile will have a good season, while Argentina’s 2013 harvest will likely rebound from last year’s light crop.
Consumption is beginning to increase in some key markets as consumers discover new and more affordable wines.
That significant shift to lower-value wines in major import markets, such as Britain and US, has begun to create some welcome pricing tension for suppliers.
The prolonged economic downturn in the European and US markets has “played havoc’’ with demand for sparkling wines, channelling consumers downmarket and further into the hands of the off-premise retail chains.
A range of high-quality yet somewhat previously overshadowed products and producers have found new opportunities in the European and US markets with wines such as prosecco and cava finding “new life’’, the report says.