News

The Race Against Disease

April 3, 2011 - 03:34

The weather gods have turned against the Australian Wine Industry, conditions in early March had improved and we saw much better conditions for grape growing, however mid / late March has seen very large amounts of unseasonal rain throughout many regions. As a result there has been a large increase in disease and very poor fruit quality seen on the market.

The size of the Australian harvest is still quite unknown as there is a large amount of reds to be harvested and many cooler climate regions have only just started. The unseasonal rainfall we have seen has caused a large increase in disease and potentially some vineyards being rejected due to disease. The size of vintage will be dependant on how much fruit gets rejected, how many tonnes the wineries pick as many wineries are now picking as much fruit as possible before disease becomes too prevalent. Baume levels are still quite low in some areas so there is a concern on the fruit ripeness, which may cause quality issues? We need to wait and see post fermentation; an advantage we will have is that we have had a much cooler summer and the primary fruit characters have been strong. Due diligence on the qualitative front will reveal two distinct quality levels. There will be very good material (due to the much cooler ripening conditions) and also some poor material (as a result of fruit that has had significant disease and has been picked and made into wine).

New Zealand is still on track for quite a significant harvest, crush has only just started but reports are that they are going to have a reasonable year in both quantity and quality.

Posted in: Australia

Smaller Than Average Crop Size Predicted

March 4, 2011 - 02:04

All areas have shown a decrease in volume from the December harvest estimate. The flood damage in the Orange River region is still unknown, but some estimates put the area at a 15% loss. The main factors contributing to the smaller estimated 2011 crop were the smaller berry and bunch sizes and the dry, hot weather in February. Despite the smaller crop, the quality, flavor and yields are looking good in all areas. White Varietals constitute 65% of the total South African crop. Reds therefore remain in high demand and in short supply, resulting in shortage on both Generic- and Varietal Rose as well as Generic Red, as wineries focus their red grapes on producing higher priced Red Varietal wines.

In 2010, 487 M lt. of natural wine was sold in bulk and of that, 150 M lt. were exported. 9.8 M lt. of natural wine and grape juice was imported into South Africa in 2010. Between January 2010 and December 2010, the South African Rand (ZAR) strengthened against the British Pound by 8.6%, the Euro by 17.3% and the United States Dollar by 12.1%. The wine industry makes up for 2.2% of the total South African Gross Domestic Product.

Posted in: South Africa

Italian Generic Wine Prices on the Rise

March 4, 2011 - 02:04

Italian generic prices continue to increase, however the volume of wine available, and the volume of wine sold remains average compared to prior years, creating the impression that the price increase is not justified. The wine growing region of Maremma Toscana will soon achieve DOC status under European Union law, thus officially classifying it as a protected appellation of origin after years of carrying the IGT designation (Vin de Pays).

As Vinitaly approaches, major suppliers and buyers are wondering about the future of the Italian wine industry. Domestic consumption is decreasing, and exports are increasing as Italian wineries face stronger global competition. For more information, please see: http://waitingfor.vinitaly.com/.

Posted in: France

Spanish Generic Prices Rising

March 4, 2011 - 02:00

Spain has seen a 20% price increase for Generic Wines over the last month and where large volumes were still available a month ago, many of these available wines are now being reported to be sold out. Cabernet Sauvignon and Merlot are almost completely gone, but some small lots have come up for resale. In contrast, Tempranillo, Syrah and Generic Rose are still available in significant volumes, however, the strong pricing on Generic Wines has had a similar upward effect on pricing for these varietals as well. Despite increasing prices, Spain will remain one of the more interesting supply countries in terms of the quality to price ratio for the coming 2011 vintage.

Posted in: France

Prices Continue to Rise

March 4, 2011 - 02:00

Market for German Wine: Prices have continued to increase and some wines have been priced out of the market. Wineries are having a challenging time finding wines to fill their contracts. For some varieties it does not matter what price is being offered, the wine is not available.

Market for Imported Wine: Buyers of foreign bulk wines have become active as they have realized that prices are not going to go down in the medium term. We have already seen a number of pre-harvest deals on the Southern Hemisphere, 2011 vintage wines.

Posted in: Germany

French Red Wine Stocks Diminishing

March 4, 2011 - 01:54

The French market is still tight and less and less volume of Cabernet Sauvignon, Merlot and Generic Reds are available. Chardonnay bulk wine is almost entirely sold out, however there is still Sauvignon Blanc available in significant volumes. Pricing for Red Varietals has increased consistently from 0.65 – 0.68 €/lt in October 2010, to 0.70 – 0.72 €/lt in December 2010 and at least 0.75 €/lt in March 2011.

Posted in: France

Buyers Start Contracting 2011 Wines

March 4, 2011 - 01:33

Harvest has begun and early indications show that this crop will be larger than last year's crop, but smaller than previously expected. Inventory levels are lower than normal for this time of year. These low levels combined with strong demand for bulk wine has caused strong demand in the grape market. Limited quantities of grapes are still available, however most of the fruit has been contracted. 2011 grape prices have reached $280/kilo and the latest estimates are for a base of $220 - $240/kilo (2010 was $170/kilo). After two months of low demand for Chilean wine, February has seen an increase in buyer activity. Wineries are giving 2011 bulk wine quotes on a case by case basis, but in general would like to know the minimum guaranteed grape price before contracting large volumes.

Posted in: Chile

Crush Report Released: Third Largest Crush in State History

March 4, 2011 - 01:33

The California Department of Food and Agriculture released their Preliminary Grape Crush Report on February 10, 2011. The report showed that California wineries crushed 3.24 M Metric Tonnes, (3.58 M. US Tons), down from 3.70 M Tons in 2009. This smaller 2010 harvest would still make for the 3rd largest crush in Californian history. Pre-harvest estimates were significantly less due to weather concerns, so the report came as a pleasant surprise to our very active bulk and grape market. The larger than expected harvest has done little to dampen current pricing as today’s market continues to be driven more by demand and cautious signs of economic recovery.

Light crops were noted in the Northern Central Valley regions of Lodi, Clarksburg, and Modesto (all experienced record yields in 2009) while larger crop levels came in from the Southern Central Valley Region of Bakersfield to Fresno. The ultra premium regions of Napa and Sonoma showed harvest declines of 3% to 10% while other premium North Coast and Central Coast Regions were up this year by 2% to 10%. Grape pricing was down in general, with the Premium North and Central Coast Regions experiencing the largest declines, however pricing for the Central Valley was up 2% to 4%, reflecting growth in the sales of “value brand” wines.

Activity and demand continues for Cabernet Sauvignon, Merlot and all Red Blenders. The 2009 Chardonnay inventory is still relatively “long” but a smaller 2010 harvest will help balance supply. Florals such as Muscat are in high demand and sell primarily as future contract grapes or wine, while little remains on the bulk market.

Posted in: USA

Rain is Still Causing Concerns

March 4, 2011 - 01:32

The story in Australia has not changed too much over the last month; rain is again causing many issues with growers and wineries. Wineries are picking as much white as possible before disease becomes too prevalent within their crops. All concentrate facilities are fully booked out with wineries concentrating juice as baume levels are low in the white grapes. It is going to be interesting to see what effect the rain has on the reds, disease pressure is high and there are reports that Shiraz is just hanging on in certain areas. The size of the Australian harvest is still quite unknown, there has been a lot of fruit that has been rejected due to disease. Estimates are still in the vicinity of 1.2 to 1.5 million tonnes, however tonnes are down in some areas, while estimates are slightly up in other areas and the extraction rates seem to be okay at the present time. The end result will be dependant on how much diseased fruit is picked at lower prices (will growers accept these?) and will there be anymore rain when the reds are harvested? Other cooler climate regions throughout South Australia have seen reasonable rainfalls in the last month, the effect of this rainfall on crops is unknown. Will disease become an issue? Will the fruit ripen enough (baume levels have stalled)? All these unknown factors could have an outcome on the final crop figures.

NZ is still on track for a significant harvest, estimates are still around 300,000 tonnes, this is 10% up from 2010. Harvest is still a few weeks away so a better estimate will occur once harvest commences. A large earthquake has rocked New Zealand’s South Island in Christchurch (6.3 magnitude), 163 people have tragically died. The wine region of Canterbury seems to have escaped any major damage.

Posted in: Australia

Harvest has Begun and Quality Appears to be Good

March 4, 2011 - 01:29

The 2011 harvest has begun, and despite trying weather conditions throughout the growing season, the quality appears to be good. The weather continues to be slightly humid, but rains have helped ease the drought. Prices will not begin to firm until March, but the government has set aside almost $28 million dollars to buy grapes on the spot market to produce white grape juice concentrate. This practice has been going on for a number of years and is used to maintain high grape prices. Most believe this will be a good year for Argentinean concentrate exports as the government has significantly increased production volume. Red Varietals are still in high demand and prices for Generic Reds have surpassed $0.70 USD/lt. Varietals have passed $0.90 USD/lt. with the exception of Malbec which is currently above $1.50 USD/lt. These prices only reflect the domestic market, wines for export will be even higher due to a 20% government excise tax. The government has confirmed the official forecast given in December 2011 crop will be larger than last year (+5%) and closer to the historic average of 2,75 millions metric tons.

Posted in: Argentina

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