Industry news
Burgundy – price rises likely due to short crop [ 2013-1-6]
A small 2012 crop, coming on the back of low inventories and strong demand in the French and international markets is likely to lead to a rise in prices, said the Burgundy trade board BIVB at its AGM last month. The annual Hospices de Beaune wine auction in November revealed the extent of the shortage of wine region-wide and the impact this would have on retail values. The price of basic red AC Burgundy in bulk has already risen by 30 percent compared with the previous year and according to BIVB chair Pierre-Henry Gagey, both wine growers and shippers alike will be forced to pass on the increase to end consumers. In fact, Gagey predicts that Burgundy wines will head north in terms of market segment and is urging the region’s wine industry to ensure that once the shortage ends and crop levels return to normal, the new pricing structure will remain in place. His viewpoint echoes that of Louis-Fabrice Latour, who in November predicted the demise of Burgundy wines retailing for under 10 dollars, 10 euros and 10 pounds. On the flipside, the drop in output last year has led to declining revenues for the marketing board which will therefore have to axe some of its promotional drives tabled for 2013.
Amongst other topics discussed during the AGM was the pressure exerted by Asian and American demand on wine styles exported by Burgundy: with a large proportion of the region’s vineyards planted to Chardonnay and demand focusing primarily on red Pinot Noir wines, the issue of modifying supply structure was raised.
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