VINEX Regional Manager Report: Paul Attwood-Philippe, Europe
Here we take an overview look at what is expected to be a return to form for the major wine producing power houses of northern Europe.
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Average or strong harvests are expected in the key growing areas of France, Germany, Spain and Italy. There will be some regional differences, but the forecasts are strong, particularly Spain, with at least average harvests expected if not higher in some areas.
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The predictions have already got major buyers and importers on the front foot, negotiating price reductions on 2017 and bringing them more in line with 2016 prices.
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That means we can expect to 10 cents a lire per 75cl bottle price reductions across the board, driven by Italian Pinot Grigio that will set the standard for the other generic varieties to follow.
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The further north you go the better growing conditions and volume and quality of the cop.
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This is down to a cool winter, with good rainfall, high water table, followed by hot weather across June, July and August, with enough rain to keep the vines refreshed.
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There are though problems with mildrew in southern France, and the Languedoc as high rains and hot temperatures have created problems in some areas.
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There will still be demand for East European wines following their breakthrough year in 2017/2018 filling gaps from the short western harvests.
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Buyers and retailers that have made good relationships in Eastern Europe “have stolen a march” on their competitive set as they have made the investment for “medium to long term” supply partnerships.
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This is being driven mainly by UK buyers and supermarkets whose customers are more willing to experiment and trial wines from emerging countries. European buyers are in more of a wait and see mode and are not convinced their own consumers will buy the wines.
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East European producers will need to accept lower prices in 2018 with 70c and 80c a litre wines last year dropping down to 60c to 65c. Pinot Grigio will settle around 60c to 65c and then 50c a litre for Merlot, Cabernet Sauvignon, Chardonnay and Sauvignon Blanc.