Areas of activity
Prospective buyers have been eager to discuss pricing and availability on South Africa’s coming 2024 wines, as the country’s 2023 inventory is minimal. Loadings have proceeded steadily in Italy, with Pinot Grigio and Prosecco in good demand. Chile received Chinese business in January as well as enquiries from around the world amid some softened pricing versus mid-2023. More transactions might have occurred in Spain if the country’s pricing had not risen in response to an initial demand uptick stimulated by the shorter Spanish and Italian crops.
Price-sensitive buyers
Chile and Spain’s contrasting fortunes illustrate that buyer demand is often price-sensitive, not missing altogether. Many bulk wine buyers remain choosy on price, quality, and volume, believing they can afford to be because of the amount of inventory available. But having bought less or even not at all in 2023, buyers may have greater need in 2024, especially if improved consumer sentiment in North America and Europe translates to increased discretionary spending.
Price-sensitive suppliers
Suppliers are also highly price-sensitive as they seek to cover elevated input and winemaking costs. ProWein’s recent state-of-the-industry report found that only 6% of responding producers saw their profits rise in 2023, versus 60% whose profits declined.
As well as Mother Nature, what needs to be considered when forecasting this year’s crops is cost-conscious producers cutting spending. For example: holding off from new plantings, leaving vines unpruned or unsprayed unless/until grapes are contracted, not picking uncontracted grapes, or uprooting vines altogether.
Southern Hemisphere crop latest
The Southern Hemisphere’s 2024 harvests are now getting underway. Early expectations in Argentina, Chile and South Africa are for average to below-average crops. In Australia, some early inland grape tonnages have been below the average. In New Zealand, the early expectation is a crop 20% below 2023’s large harvest.
Excessive heat combined with strong winds triggered a spate of wildfires in central Chile in early February, most notably in the Valparaíso region north-west of Santiago. Vineyard areas have reportedly been undamaged, while smoke was funnelled away by the winds.
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Identifying sourcing and selling opportunities that provide margin and cashflow, and building buyer-seller relationships for long-term security: this is where Ciatti can bring its decades of knowledge and experience to bear. Don’t hesitate to get in touch. In March, please do come visit us at ProWein: we will be on stand H60 in Hall 14.
