Wine world’s bid to boost production

(FTAdviser) - Reports of a global wine shortage in the near future caused by demand outstripping supply provoked outcry earlier this year, even though numerous wine organisations subsequently dismissed the idea.

The growing demand from emerging markets such as China and India, combined with recent poor harvests, has reinforced the impression that the wine industry is under pressure.

However, the latest state of conditions report from the International Organisation of Vine and Wine (OIV) states that wine production has already increased significantly in 2013, primarily driven by production in Romania, Chile and New Zealand, in addition to a stabilisation in world consumption.

Presenting the findings of the report Federico Castellucci, director-general of the OIV, explains: “In 2013, there has been a significant global harvest, also thanks to the development in the productivity of vineyards. With a loss of 300,000 hectares of vines compared with the year 2006, the 2013 harvest has been fairly significant, thanks to a productivity which continues to increase in spite of the abrupt stop caused by adverse climate conditions in 2012.”

Forecasts from the OIV suggest the world should produce roughly 281m hectolitres (Mhl) of wine in 2013, up from an estimate of 258Mhl in 2012, bringing production back to levels last seen in 2006.

This is in spite of the world’s vineyards continuing to decline in size, albeit at a slower pace than previously forecast.

The increased production from a smaller area is helping to improve the supply and demand characteristics of wine, although there are other factors helping to boost wine production.