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New drinking patterns

What does the future hold for wine producers?

ANDREW J. LINN

Friday, 15 May 2020, 13:00

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Wine sales are down worldwide. Not necessarily because the usual band of wine lovers has suddenly reduced its personal consumption (some chance - probably the reverse) but a huge proportion of the wine that gets sold is traditionally consumed in the currently closed bars and restaurants. The phrases 'I never drink alone' or 'I don't drink at home' resonate throughout even the keenest aficionado's prating.

The OIV (International Organisation for Wine), organisers of, among other events, the Bacchus Awards, indicates that world consumption of wine has fallen drastically owing to Covid-19. It is estimated that winemakers will see their income cut in half. While previously such dire and calamitous situations have usually been followed by a brisk recuperation, this time nobody can be certain what will happen. The situation is without precedent. Understandably, EU wineries expect to receive financial assistance from Brussels, but the greatest fear is that the vicissitudes may mark a new pattern in winemaking and wine consumption globally. This comes on top of what was considered another fraught situation provoked by Trump-imposed tariffs: a 25% import duty on EU wines entering the US.

What does the future hold for wine producers? They have to calculate accurately what future sales will be, difficult with a supply chain working at half efficiency. The coming 2020 grape harvest will be crucial and there are even doubts that sufficient labour will be available. Virus-hit Italy depends on exports of Prosecco for much-needed foreign exchange, so getting winery operations back to normal there is crucial. China may not export much wine these days, but its factories make the bottles, capsules and other materials used by winemakers.

In many markets, sales of spirits have risen by as much as 75%, and in USA tequila sales have overtaken gin. Ironically, sales of Corona beer have increased 50%.

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