As the global bulk wine market enters 2025, it continues to reflect the trends observed at the close of 2024.
The market remains highly fragmented, with varying levels of supply and demand across key producing regions. A notable theme is the tightening availability of generic wines, particularly in Europe, Chile, and South Africa, due to the impact of successive shorter winegrape crops in 2023 and 2024. This has led to rising prices in some regions, particularly Spain, where increased costs have prompted buyers to explore alternative sources, including France, Chile, and Argentina.
Europe: Spain’s Price Surge and Alternative Sourcing
Spain has been at the center of price increases, with generic wine costs climbing steadily since November 2024. European buyers, responding to this upward trend, have begun seeking alternatives in France, Chile, and Argentina. While standard-quality varietal wines remain more readily available, white varietals are in tighter supply compared to reds. This is evident in regions like Chile, South Africa, and Australia, where low carryover stocks have pushed white wine prices closer to equilibrium. As the Southern Hemisphere gears up for its 2025 harvest, expectations are for average-sized crops at best.
France:
- Incremental market activity: Slow start to the year but steady movement.
- Stable pricing: Prices remain generally in line with last year.
- Highest demand: For Vin De France and higher-end wines, while the mid-market is quieter.
- Competitive entry-level pricing: Some wines are priced lower than Spain’s, offering good volume opportunities.
- Good availability: 2024, 2023, and non-vintage VDF red, white, and rosé wines, along with 2024 IGP whites and rosés.
Spain:
- Elevated pricing: Bulk wine prices continue to rise, especially for generic and varietal whites.
- Slowing transactions: Buyers struggle to secure supply at desired prices.
- Alternative sourcing: Interest is shifting to France and Chile due to high Spanish prices.
- Sulfated must market paused: Pricing remains too high for active transactions.
- Buyer recommendation: Secure bulk wine volumes based on sample approval.
Italy:
- Limited supply & rising prices: Generic whites and reds are scarce, with elevated pricing. Pinot Grigio and Chardonnay are also becoming more expensive.
- Incremental buying: Purchases are proceeding cautiously.
- US export surge: Shipments increased post-election due to potential import tariffs, but US demand may slow in coming months.
- Prosecco & Pinot Grigio resilience: Prosecco DOC (+11.5%) and Pinot Grigio (+2.0%) bottlings remained strong in January.
- New wine labelling law: Italian wines under 8.5% ABV can now be labelled as "wine" (excluding IGT, DOC, DOCG).
California:
- Smaller-than-expected 2024 crop: Estimated at 2.84 million tons, with lighter yields and some uncontracted grapes left unpicked.
- High bulk inventory: Estimated at over 35 million US gallons, creating opportunities for buyers.
- Competitive pricing: Available on generic wines, White Zinfandel, and traditional bulk options.
- Growing interest in low/no alcohol wines: Demand increasing in the “better-for-you” and low-calorie segments.
- Coastal wines for mid-tier programs: Available with one-year and multi-year deals.
- Bulk market activity: Slight increase in domestic demand, while international interest remains steady.
Argentina:
- Significant 2024 vintage inventory: Despite improved exports, Argentina still holds large volumes of wine.
- Popular wines remain available: Generic whites, GJC, and all Malbec quality tiers are still on offer.
- Lower and negotiable pricing: Prices have dropped since mid-2024 and may be flexible based on volume and loading terms.
- 2025 harvest outlook: Expected to align with the new average of 2.2 million metric tons.
- Wineries reluctant to accept grapes: Due to high wine inventory, some grapes may go unpicked.
- Stable grape prices: No significant changes from 2024 levels.
Chile:
- Limited availability of 2024 wines: Especially generic whites, with prices higher than a year ago.
- Ongoing buying activity: Incremental purchasing of 2024 wines and inquiries into 2025 availability.
- 2025 yield expectations: Likely average or slightly below due to vineyard removals over the past two years.
- Moderate price increases: Suppliers aim to stay competitive in the global market.
South Africa:
- 2024 wines sold out: Focus is now on the 2025 harvest and pre-contracting.
- Export pricing: Likely influenced by strong domestic demand and early international enquiries, but still negotiable to retain market share.
- Smooth growing season: Vineyards are in good condition, with early harvesting proceeding well.
- Crop size expectations: At least 1.18 million tons (equal to 2023), but a larger harvest is needed to meet demand and rebuild exports.
Australia & New Zealand:
- Harvest in Australia size is expected to be average, depending on how much fruit remains unpicked. In New Zealand, potential for a large harvest, but the final size depends on how many grapes are left unpicked.
- White wine varieties are in higher demand than red, though interest in Cabernet and Merlot is increasing.
- Total wine exports grew by 7% in 2024, with mainland China returning as a significant buyer, purchasing 83 million liters from April-December.
- Exports to other regions fell but were offset by the Chinese demand.
- Competitive pricing for wines from New Zealand on carryover stock available for quick sales to clear tank space.
- New Zealand led in the UK retail market for still white wine in December, growing by 7% from 2023, with a 9.8% increase in the moving annual total.
Trade Tensions and Global Market Adjustments
The international wine trade is navigating new challenges beyond supply constraints. The recent tariff dispute between the US and Canada has raised concerns about additional trade barriers, impacting industry stability. While the disagreement was not directly related to wine, the retaliatory sentiment in Canada could hurt US wine exports to its most crucial overseas market.
Meanwhile, Italy has experienced increased wine exports to the US since the presidential election in November 2024. This surge stems from concerns over potential US tariffs on EU imports. However, to date, the new US administration has confined tariffs to steel and aluminum, leaving the wine sector untouched for now. At the same time, ongoing trade frictions between the US, EU, and China continue to cast uncertainty over global wine flows.
Source: Ciatti