Looking beyond the Pandemic, at the “Valpolicella Annual Conference”

Everyone is quite aware of the still very complex and far from being resolved situation, even for the wine trade -the health pandemic, US duties, Brexit and more. However, a slight air of optimism has come from the “Valpolicella Annual Conference”, official meeting. The Consortium for the protection of Valpolicella wines organized two digital days dedicated to new policies to support the Italian wine market. The game is certainly not over yet, but one thing is certain: we must see the glass half full, as does the Estate of one of the most prestigious Italian wine territories, such as Valpolicella. The denomination achieves a turnover of 600 million euros per year. Valpolicella wines, though they fluctuated on the markets in 2020, in the midst of the Covid-19 health emergency, have all closed the year with a sigh of relief (on the whole, along the lines of the Italian wine trend, ed.). Amarone (production capacity of over 15 million bottles) resisted, Valpolicella (18 million bottles) and Ripasso (30 million bottles) instead dropped. Exports did better than the domestic market, and the big companies are smiling, but not the small ones, as the average price dropped somewhat for everyone. “Given the economic situation”, said Christian Marchesini, president of the Valpolicella Consortium, “we are satisfied with the positive performance of Amarone, which has allowed us to resist the impact, so we closed the year and name management better than the national trend”.
The general summary described above, comes from data that Valpolicella-Nomisma Consortium Observatory collected, and Denis Pantini, head of Nomisma-Wine Monitor, presented. The Valpolicella appellations, which are the main hub for the production of red wines in Veneto, closed wine sales in value in 2020 at -3.3%, the exports result was stable (-0.1%) and there was a decrease in Italian demand, -9.6%. “The Ripasso production”, explained Marchesini, “increased + 50% from 2011 to 2020, first of all, thanks to the great success abroad, and then in Italy. Valpolicella, instead, which has been decreasing over the years, should now go towards stabilizing. We had neglected it and now we want to remedy our mistake by focusing on enhancing Valpolicella Superiore, following both an old and new road at the same time, as well as following the path many companies have undertaken, and focusing on crus. We are concerned about the disparities within the general data, as the small quality companies, the backbone of our denomination (258 out of 329 total, ed.), which have paid heavily due to the closure of the HORECA (hotels, restaurants, catering) sector, registered losses of -10% for exports and -28% for domestic demand”.
Looking to the future, as Luca Zaia, president of the Veneto Region emphasized in his opening remarks, “the global economy will resume when the Pandemic is under control and whoever reaches this milestone first will have a consistent competitive advantage. It is essential to proceed quickly with the vaccinations we need”, he explained that the Veneto is considering purchasing doses of the vaccine autonomously, “because we would be able to vaccinate 5 million Venetians in 100 days”.
In the Veneto region, the agricultural and tourism sectors play hand in hand; therefore, reaching this milestone at the beginning of the summer would mean being able to welcome visitors again and give breath and energy to both sectors. The interest in developing wine tourism is very high in the region and also in Valpolicella, where a survey carried out by the Consortium showed that 7 out of 10 companies intend to invest in this area over the next few years.
“In Veneto”, continued President Zaia, “we produce 11 million hectoliters of wine, we have 54 denominations, some of which are free of problems. However, there are many companies in distress that have their wine cellars stocked and need to be helped utilizing part of the 222 billion euros coming from the Recovery Fund, to restart them. The same goes for the HORECA sector. Moreover, it is not clear why restaurants that are open for lunch should remain closed in the evening. What are you afraid of, that the virus, like Dracula, will only come out after dark?”
Paolo De Castro, MEP, and first vice president of the Agriculture Commission tackled the three hottest issues currently in Europe - wine and the EU Commission's anti-cancer plan, US tariffs, and last-minute, negative Brexit deals. The EU Commission’s current anti-cancer plan poses a threat to the wine sector, as it would punish alcohol and meat indiscriminately by type and quantity, De Castro said, “this is not a legislative proposal, but an inviolable plan in its general aims. The European Parliament, together with the Agriculture Commission, will work to avoid consequences both on the promotion side and on labeling”. As far as US tariffs are concerned, he announced, “The European commitment is a 6-month moratorium, to have time to discuss the problems, which still remain, with the Biden administration as soon as his team takes office permanently”. “The last-minute agreements on Brexit were necessary, but negative”, he concluded, “and are proving disastrous for us and especially for the British, due to the numerous bureaucratic-administrative problems. We, and Wine Intergroup requested a suspension until an electronic platform of export certificates could be set up that would solve the big problems we are experiencing in wine exports”.
In other words, the European Union is present and, as MEP Herbert Dorfmann mentioned, the retroactive extension dated October 20, 2020 of funds for crisis interventions (green harvest, distillation) has just been signed in the Agriculture Commission. “There will therefore be continuity and the measures that were in place will continue for 2021”, said Dorfmann, “hoping that the wine sector’s current problems will be solved, and that is, the HORECA sector closing down, the decline in tourism at an International level and in particular, the decline exports to the important US market”. Veronafiere is also counting on the new normality. “We are working towards opening Vinitaly, fixed number of participants, and oriented towards the recovery of the domestic demand as well as the European one”, began Giovanni Mantovani, CEO of Veronafiere. “It is necessary to be ready to intercept non-European workers who will be restarting in June because they have already been vaccinated. Italian wine cannot afford to lose this competitive advantage. And, regarding the collapse in the turnover of the Italian fairs industry, I hope that the new government will implement, very quickly, non-repayable loans and relief packages, provided by the various decrees, as well as exceeding the “de minimis” limit as Germany has already done. Otherwise, there would be a serious disparity with our European competitors, which would put not only the Verona Fair, but also the entire sector at risk”.
The time horizon to exit the crisis for the global wine trade, however, is still far away, according to the Italian Wines Union. “From the data our Observatory has collected, returning to the pre-Covid situation will be possible no earlier than the end of 2022”, underlined Paolo Castelletti, general secretary of the Unione Italiana Vini (UIV). The closure of the HORECA sector around the world will result in a drop in wine consumption of over 100 billion dollars in the three-year period 2020-2022, which is a huge commercial loss for our sector. At the national level, we are asking to cancel the obligation of closing the wine bars at an early hour, set by the DPCM (ministerial decree), restocking funds for the sector expected for last year (50 million euros), and launching the likewise expected single regulation on sustainability”.