How looming wine shortages could shape the market

Sunday, 28. January 2018 - 16:00

Credit: Geoffrey Fairchild/WikiCommons

As an avid collector of odd newspaper headlines, I was delighted to come across “One in three Londoners live in fear of Prosecco shortage” in the London Evening Standard last October. To be fair, the news story that followed was all about a study of millennials’ trivial ’first world problems’ such as leaving one’s phone at home, forgetting a login password and having to stand on public transport. Apparently, a surprising number of the young people questioned by University of London Goldsmiths College researchers particularly ’feared a repeat’ of the previous year’s shortage of Italy’s most successful sparkling wine.

A brief internet search for ‘Prosecco shortage’ prompted by the Evening Standard piece revealed that newspapers had not only run headlines about this worrying event in the spring of 2016, but also in April 2015. This was despite the fact that in neither year had anyone who really wanted a bottle been unable to obtain one.

I don’t know what it was about Prosecco that so caught the imagination of the media, but many of those same journalists seem to have ignored the fact that, when it comes to wine shortages, the world is bang in the middle of a perfect storm that is likely to have significant impact on the wine industry and on the the bottles on many people’s tables across the globe.

A combination of frost and drought led to Europe producing 14% less wine in 2017 than the previous year, with Italy suffering the worst shortfall with a cut of over 20%. On the other side of the Atlantic, California’s vineyards were hit by forest fires, while El Niño was responsible for cutting production in Chile and Argentina. 

Last year’s problems have not gone away. Italy’s soils are still dry and Cape Town is set to become the first major city on the planet to run out of water. South Africa’s 2018 crop is expected to be the smallest since 2005.

Despite the rains that were brought by El Niño, Chile declared a state of emergency in December in drought-hit Coquimbo and parts of Valparaíso. Forest fires, of the kind that have hit California and Australia are also increasingly common in South America - and for the same reasons. Australia seems set for a normal-size 2018 harvest, but that too could change if the wine regions are hit by a predicted hot spell in the next few weeks.

Taken collectively, climatically-driven shortages have made for the smallest 2017 harvest in 36 years and the dearth will be most keenly felt this year. As a professional I met this week said “It’s the first time I’ve seen big UK buyers with fear in their eyes at the prospect of not being able to fill their shelves.”

Of course, it’s a very ill wind that does not bring gifts for somebody, and wine producers in Eastern European countries like Romania, Macedonia, and Moldova where I was working last week, all have plenty of 2017 wine to sell - and sales staff who are busily fending off urgent enquiries about the availability of Pinot Grigio and Merlot. 

Unfortunately, even where they are able to supply some of this demand, countries like these know that, like an acquaintance who accepts a last-minute dinner invitation, they are simply filling a gap until wine begins to flow again through the traditional pipelines. Worse still for them, of course, is the lack of commercial (as opposed to intellectual) interest in the local grape varieties of which they have far larger volumes.

Two solutions are clear. On the one hand, 2018 offers a unique opportunity for any hitherto lesser-known wine region or country with wine in its tanks to devote every dollar it has - and maybe some that it hasn’t - to market itself to the international wine trade. Relationships developed this year will certainly pay huge dividends when the next perfect storm comes along, which could be sooner than most people expect. And maybe even before that.

On the other hand, it is time for wine brand-owners to begin to wean consumers off their simplistic diet of varietal wine. The US giants are ahead of this game with their proprietary red blends such as Apothic and the Prisoner; I expect others to follow in their footsteps. 
Stand by too, for the arrival of a crowd-pleasing, multi-regional sparkling wine brand. If the producers get the blend and marketing right, there are apparently millions of Londoners who’ll be desperate to buy a bottle when the the next Prosecco Shortage headlines appear.
Robert Joseph