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Ciatti Global Market Report, February 2022

The first few weeks of 2022 on the bulk wine market can generally be characterised as hesitant, as last year’s OND sales and the coming crops in the Southern Hemisphere were assessed. The retail sales picture is difficult to generalise, but it looks like sales in those markets that received a pandemic bump are pulling back, while those that took a pandemic dip are recovering, so that – from a global perspective – sales volumes and patterns are evening back out to the pre-pandemic normal. COVID-19 is being referred to in the past tense in some markets – such as the UK and Scandinavia – and the WHO has said that, while the pandemic is not over, the world is now in a “ceasefire” with the virus “that could bring us enduring peace”. 

Until such time as sales patterns begin to settle, the bulk wine markets will continue to proceed incrementally on all but the short or most in demand wines such as international white varietals (namely Sauvignon Blanc and Chardonnay) and higher-quality reds. On the reds, supply quality in Europe is heterogenous due to the frost-affected growing season, particularly in France, so the higher qualities represent a smaller percentage of total availability; consequently, buyers seeking the best price-quality ratios are urged to make their needs known sooner rather than later as headline red inventory figures may mask the true nature of the underlying market. 

It’s far too early, meanwhile, to call this year’s South Hemisphere vintages, but tentative signs are for average-sized crops in Chile, South Africa and New Zealand and potentially a slightly below-average crop in Argentina; Australia’s potential is not yet discernible. The Southern Hemisphere summers except Chile’s seem to have been wetter and – in some cases – more humid than normal, all the while January in the Northern Hemisphere’s vineyards was drier than average. This counterintuitive picture is potentially attributable to the weather phenomenon La Niña. 

The logistical headaches – shipping containers shortages, port congestion – seem to be easing week-on-week in some markets, though they remain suboptimal everywhere, especially on the west coast of the Americas. Annual inflation, meanwhile, continues to climb in the US (+7% in December), UK (+5.4% in December) and the Eurozone (+5.1% in January, a record), accelerating input costs and, potentially, damaging consumer spending as the year wears on. Rising inflation and logistics problems are compounding the hesitancy on the bulk market as buyers must not only calculate if it is possible to get wines from A to B in time but whether they can accept the rising cost of bottles, cardboard, labels, and other dry goods on top of already elevated freight costs. 

Buyers and suppliers are going to have to be extra amenable and flexible in their relationships this year in order to make things work. The WHO’s “peace” will hopefully allow the return of well-attended global trade shows after two years without them, an important development for building and strengthening such relationships. (ProWein in Düsseldorf has been postponed due to Omicron, but only by two months to 15-17th May; the London Wine Fair has, in turn, moved back three weeks to 7-9th June.) Ciatti is here ready to draw on its decades of experience to help bolster bulk wine and grape relationships every step of the way in 2022. Read on for detailed updates from each market, get in touch with us directly for help, and stay safe.

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Grape Market Bulk Wine

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