Shorter harvests fail to stir uncertain bulk market The Northern Hemisphere harvests are in full swing and this month’s report relays the latest news from the vineyards on crop size and grape quality. Only one of California, France, Spain and Italy appears on course for a crop size in line with its five-year average, the others look set to come in short to varying extents, whether due to Mother Nature, vineyard removals/mothballing, or both. But with inventories long and North American and European retail sales of wine continuing to struggle, the bulk market has been largely unmoved. This month’s report identifies the activity that has occurred. Inflation and a cost-of-living squeeze are increasingly cropping up again in industry conversations. While the worst of the post-pandemic inflationary tailwinds are in the past, grocery and energy prices remain significantly elevated versus 3-5 years ago and consumers are reducing their spending on discretionary items accordingly.

Sampling is in full swing on the Southern Hemisphere’s 2025 vintage and quality has been rated very positively. The great majority of sampling activity is being carried out by longstanding customers with established programmes and tenders; new buyers, and new programmes, are few. Only Chile and New Zealand experienced non-average crop sizes but in contrasting ways – Chile’s was as much as 25% short, New Zealand’s is expected to have been “very large” despite fruit going unpicked in response to generous carryover stocks.  The shortness of Chile’s crop triggered brisk early sampling by international buyers and the securing of batches by domestic buyers. Even in this context, however, the lack of new international business has been noticeable. In the Northern Hemisphere, meanwhile, bulk wine markets have been proceeding steadily, with activity largely consisting of incremental demand for small volumes on a just-in-time basis.  The persi

Sampling is in full swing on the Southern Hemisphere’s 2025 vintage and quality has been rated very positively. The great majority of sampling activity is being carried out by longstanding customers with established programmes and tenders; new buyers, and new programmes, are few. Only Chile and New Zealand experienced non-average crop sizes but in contrasting ways – Chile’s was as much as 25% short, New Zealand’s is expected to have been “very large” despite fruit going unpicked in response to generous carryover stocks.  The shortness of Chile’s crop triggered brisk early sampling by international buyers and the securing of batches by domestic buyers. Even in this context, however, the lack of new international business has been noticeable. In the Northern Hemisphere, meanwhile, bulk wine markets have been proceeding steadily, with activity largely consisting of incremental demand for small volumes on a just-in-time basis.  The persi

Global wine consumption in 2024 is estimated by the Organisation of Vine & Wine (OIV) to have reached 214.2 million hectolitres, down 3.3% versus 2023 and the lowest level since 1961. In its recently-published 2024 industry report, the OIV attributed the decline in consumption – which has “followed a relatively steady trajectory since 2018” – to significantly reduced Chinese demand and the post-pandemic inflation surge which, although having cooled since 2023, still restricts consumer purchasing power to this day. Elevated input costs have made it harder for wine to compete against alternative beverages able to charge a lower price per unit of alcohol.  The OIV estimated global production in 2024 at 225.8 million hectolitres, 4.8% down versus 2023 and, again, the lowest level since 1961. This is attributable to climactic conditions but also market adjustments, as vineyards get mothballed or pulled out altogether in response to low winegrape demand. Glo

With a new year underway, we at Ciatti wish all of our friends, clients and business associates a very happy and prosperous 12 months ahead. Many thanks for your continued support.  If 2022 was characterised by rising inflation levels, and 2023 by interest-rate increases to tackle inflation, then 2024 was characterised by the hangover. A word for it was coined: “Vibecession” – a disconnect between the more positive economic indicators emerging through the year and consumer perceptions of the economy. In some cases, earnings increases have lagged 2021-23 inflation, reducing spending power outright. But more pervasive is a sense of a “cost-of-living crisis”: essential living expenses – mortgages, rent, fuel, energy – are noticeably higher than four years ago and constitute a greater share of total spend. As we observed in September, in a discretionary-spending squeeze, “wine’s higher price per alcohol unit versus its ever-prolif

Afternoon Brief: Global Wine Production Falls to Lowest Level Since 1961

Global wine production has plummeted to a 63-year low after frost, heavy rains and drought ravaged vineyards throughout 2024...