Wine, multiple perspectives. However, the market is still pulling, and cooperatives are preaching patience

The global economic situation is concerning, and immediate action is required, also in the wine industry. However, in a sector that also thrives on long production cycles, such as those of the vine, the risk is to take measures that are useful today, but counterproductive in the medium to long term. Obviously, this should be avoided as much as possible, especially in a context where, despite realistically negative forecasts (such as those presented recently at “Wine2Wine” by the Osservatorio of Unione Italiana Vini - Uiv & Vinitaly, which foresee a -16% drop in turnover in 2023), the market, as a whole, remains in a positive phase, as predicted by the Cooperatives, which account for more than half of Italian wine production. “Despite the difficulties associated with price increases, the market situation for the wine sector remains positive, though we anticipate less dynamism and greater uncertainties related to the current geopolitical and economic framework in the near future. However, it is necessary to wait for the harvest campaign to close and think about consolidated data, avoiding hasty steps and measures that would risk not being decisive, indeed counterproductive”, said Luca Rigotti, the wine “guide” of Alleanza Cooperative and at the helm of the Trentino Mezzacorona group, at the end of a meeting of the Cooperatives, in which some scenario data were highlighted.
EU wine production is lower than the five-year average, and initial stocks are one percentage point lower than in 2021. Not only that. The foreign trade numbers, relating to the period January-July 2022, represent a substantially stable situation in terms of quantities sold on an annual basis, but with a double-digit increase compared to the value (+ 13% over the same period of the year). “This does not mean that - said President Rigotti - there are strong concerns about the international situation that forces wine companies to compete on the market starting from a situation of considerable aggravation due to the increase in the costs of all production factors. The increase recorded in terms of value does not even allow to cover the higher production costs and it is here that we need to work to ensure that producers, who have so far supported and absorbed the increases, do not succumb under the pressure of price increases”.
“The wine industry - Rigotti recalled - proved to be dynamic and capable of recovering from the crisis and maintaining employment levels even during the pandemic’s darkest period. Now, for the sector’s future and vitality, the impact of unsustainable energy, logistics, and material costs that must be normalized as soon as possible through the urgent adoption of effective measures is becoming increasingly decisive. In addition to affecting the remuneration of members, the increase in costs in fact puts the economic sustainability of wine companies at risk in many cases. Once the emergency has been managed, it will then be necessary to think about innovation and reorganization processes in the sector, capable of reducing operating costs and creating value”. But in addition to the market, as we have often told and as many say, and as pointed out by Rigotti, there are also “the further concerns that come from some European policies that risk harming the sector: from the ideological approach to the wine and health to the identification of unattainable objectives in terms of reducing pesticides and without opening up to innovative and alternative tools. These are the issues on which we should focus as a sector, with unity of purpose and a methodical and scientific approach”, he concluded.