Rabobank report highlights wine optimism
According to Rabobank’s fourth quarter wine quarterly, the UK’s improving economic fundamentals, combined with a recovery in the global harvest, should provide some relief in 2014. “Improving economic fundamentals should begin to provide more support to wine consumption,” comments Rabobank analyst Marc Soccio. “However, old pressures remain as suppliers continue to deal with rising excise tax rates and a concentrated grocery retails sector.”
Wine drinkers have become more experimental in their habits, following the downturn. Consumption continues to shift into the home and is increasingly occurring alongside food. Old pub formats continue to flounder in favour of more contemporary outlets. Reports out of California suggest a very large US harvest for 2013 – potentially larger than the record breaking 2012 harvest. European inventories have rebounded as Italy and Spain have revised production figures upwards. However, poor weather in France saw production fall substantially.
In terms of export trade performance, French, Italian and Spanish export volumes fell in 2013, mainly as a result of falling bulk wine demand. Australian exports declined, while New Zealand returned to growth, due to strong demand from Northern Europe and the U.S. Argentina experienced a material decline, although exports strengthed in the second half of the year. Large harvests and a weak domestic currency saw Chilean export volumes increase 24% from January to November. The US registered solid growth, particularly in high paying markets. Supported by the soft rand, South Africa exporters climbed 25.6% in the year. The large US harvest has driven a 25% decline in bulk wine imports. However, bottled wine imports experienced solid growth in both volume (7%) and value (9%) – France and Italy emerged as the main winners.