Wine production is not escaping the consequences of the corona pandemic

Production restrictions have been agreed in several European countries. – Jan Woitas / Picture Alliance

Globally, 258 million hectoliters of wine may be produced this year. This means that production remains below the average that could be registered over the past five years. This is evident from an estimate by the International Organization of Vine and Wine (OIV). Last year, a production of 256 million hectoliters was registered.

The sector organization points for the phenomenon to the low volumes in South America and to the production ceilings that were introduced in the European Union to be able to absorb the falling sales due to the corona crisis.

Wider context

If a number of factors were nevertheless more positive than anticipated, according to the organization a production volume of 262.2 million hectoliters would be achieved. The lower limit of production, according to the OIV, is 253.9 million hectoliters. A production of one hectolitre produces 133 bottles of wine.

It is the second time in a row that global wine production is expected to remain below the average for the past five years. Two years ago, almost an absolute record production was registered.

“The lower production is not necessarily bad news for the wine sector,” said the sector organization. ‘A broader context must be taken into account. Geopolitical tensions, climate change and the corona pandemic are leading to great volatility and uncertainty in the global wine market. ‘

In the European Union, the vineyards even benefited from good weather conditions. However, yields remained below average as winegrowers and governments restricted production to counteract the negative effects of the corona pandemic. ‘

Among other things, the champagne producers in France agreed to harvest about 20 percent less grapes this year. This measure was intended to help them cope with the collapse in sales that suffered from the impact of the corona pandemic. ‘

American wildfires

The report estimates that the member states of the European Union – which, along with Italy, France and Spain, comprise the three largest wine producers in the world – will achieve production of 159 million hectoliters this year. That is 5 percent more than last year, but still lower than the average yields.

In the southern hemisphere, total production would fall by 8 percent to 49 million hectoliters. This is mainly due to a sharp decline in Argentina (17 percent), Chile (13 percent) and Australia (11 percent).

In the United States, production is projected to reach 24.7 million hectoliters. That is 1 percent more than last year.

“But the forecast could still be revised if more clarity emerges over the next few months about the impact of the bushfires in the American wine regions of Napa and Sonoma,” the report said.

Source: Reuters