The UK trade needs to brace itself for lower volumes and higher prices of one of its most popular wines, following two disastrously short years in Mendoza.
Last year, volumes were the lowest for more than 50 years, with a combination of frost before harvest and hail during vintage. But that has been followed by an almost equally disastrous 2017.
'2016 was the worst year on record, and 2017 was the next worst,' said one importer glumly.
Volumes are estimated at being 40% down for 2016 and 30% for 2017. Some regions have escaped – Salta, San Juan and Patagonia have all escaped the worst of the damage. But Mendoza, in particular the Uco Valley, has seen yields plummet and prices have already started to rise, particularly at the lower end of the market.
'Entry level wines will be $28 FOB for 9-litres, whereas it used to be $18,' said Gustavo Crespo, MD of Blends Wine Estates, which makes Argento. Bulk wine, which used to trade below $1 a litre is currently at $1.70.
'We have an agreement on price for the year, so we can’t touch that,' said Crespo, 'but we will need to renegotiate in most markets for 2018, not just the UK.'
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