With the festive season upon us, sales of food and drink are expected to rise sharply in the coming weeks as consumers stock up on nibbles and alcohol in time for Christmas Day. A staple of the Christmas table is traditionally wine and champagne, while Bucks Fizz and mulled wine also rise steeply in popularity as winter warmers.
However, consumers may be well advised to stock up on wine for the New Year now as price rises following a poor summer harvest are due to come into effect in 2013.
Majestic Wine, who last week celebrated a profitable half year report, believes that consumers could end up paying as much as £1 extra per bottle thanks to the washout summer having a detrimental effect upon grape harvests. Yet even before the wet weather washed away vineyard’s profits in early June, a cold snap in February caused many vines to die off. The result is a poor crop for the past year, meaning that production of the popular beverage has decreased hugely in the past few months.
Italy and France, the world’s largest producers of wine, have been hit particularly hard by the loss of production thanks to rain storms and cold fronts sweeping across Europe since February 2012. Even in further flung regions, wine production is expected to drop – for example, Argentina’s export levels are expected to drop by 22 per cent, therefore making the South American country unable to make up the European deficit.
At present, the average bottle of wine sold in the UK costs £5.01, with three quarters of sales taking place in supermarkets. However, Majestic Wine chief executive Steve Lewis has warned that even the notoriously competitive supermarket brands will be unlikely to keep the costs down as supplies begin to dwindle.
He said; “I would expect to see significant price inflation at entry points.
“The price of a £5 bottle of Pinot Grigio could go up by between 50 pence and £1 come February to March.”
Unfortunately, the drop in production rates has coincided with a time when, for the first time in decades, worldwide wine consumption has begun to rise significantly. Wine fell out of fashion when spirits such as vodka and whisky began to hit the shelves at lower prices thanks to advancements in production, yet is now becoming popular once more with younger drinkers.
The Financial Times’ wine expert, Jancis Robinson, says; “The shortages will be most marked in basic blending wines, not least thanks to the effectiveness of the European Union’s policy of shrinking acreage of the most ordinary vineyards.
“But it is likely that the small crop will be used as an excuse for widespread price rises – pricing of the 2012 vintage Bordeaux en Primeur will be an even more delicate art than usual, not least because of the lack of demand for the 2011’s.”
The message seems to be that shoppers should consider buying in bulk while wine is still easily available, especially as there is no guarantee that 2013’s harvest will bear more fruit than 2012’s. Even if prices remain relatively stable, there are worse things in the world than having a well-stocked wine cellar!
Do you think that the European Union should make allowances for the expansion of vineyards in Europe given the poor harvests this year? How do you think the Eurozone will be affected, especially in Italy and France, if wine production continues to take severe blows year after year?
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