War in Ukraine will also cause wine prices to rise, says OIV

The war in Ukraine will lead to rising wine prices as a result of rising energy prices and worsening supply chain problems, the International Organization of Vine and Wine (OIV) warned on Wednesday.

“The war in Ukraine has added new bottlenecks to the supply chain,” and this is having an inflationary impact on the wine sector, as well as disruptions in the supply of inputs, said the organization’s director general, Spaniard Pau Roca.

In presenting a report on results for the year 2021, Roca also warned that “the possible interruption of trade between the European Union and Russia (…) will affect the main exporters to that country”.

Russia was the tenth largest wine importer in the world in 2021, with a purchase volume of 1.1 billion euros (2% of the total), and its three main suppliers were three members of the European Union: Italy (33% of the total ), France (19%) and Spain (12%). Roca pointed out that the conflict in Ukraine “is clearly affecting energy prices”, but it is not the only factor.

First, because both Russia and Ukraine are some of the main suppliers of raw materials. But also, for example, due to the 20-fold increase in the prices of containers and other basic goods and services for international trade. Last year, world wine exports reached a record level, with an increase of 4% in volume and 16% in value to 34.3 billion euros.

Vineyards of Mendoza, Argentina: Wine production in Latin countries is also being affected by climate change - Getty Images/iStockphoto - Getty Images/iStockphoto

Vineyards of Mendoza, Argentina: Wine production in Latin countries is also being affected by climate change

Image: Getty Images/iStockphoto

In 2021, Spain became the world’s leading exporter by volume of the drink, with 23 million hectoliters, an increase of 14% compared to 2020, surpassing Italy with 22.2 million (+7.3%). However, in terms of value, the undisputed leader was France, with 11,075 million euros (+26.8% in one year), followed by Italy (7,060 million, +12.5%) and Spain (2,883, +9 .5%).

Roca said that in the southern hemisphere, where the 2022 crop is now underway, production is expected to drop 13.1% in Argentina to 10.85 billion hectoliters; 9.9% in Chile, to 12.1 billion; and 10% in Brazil, to 3.24 billion hectoliters, due to weather conditions. The OIV also estimates that there will be a drop of 5.3% in Australia, to 13.45 billion hectoliters, and an increase of 0.4% in South Africa, to 10.65 billion hectoliters.

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