Pinot Grigio shortage could see consumers opt for other white wines

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Pinot Grigio is in short supply on the bulk market around the globe, which is starting to push up prices.

Pinot Grigio

The current shortage of Pinot Grigio could mean consumers seek out value elsewhere

The popular white variety Pinot Grigio is in short supply on the bulk market, which may push up prices and prompt consumers to plump for cheaper options.

The white grape, a popular easy drinking option with consumers, is in limited supply in its main producer markets of California, Italy and Australia, where prices are increasing. One year ago prices in the US were around $1/litre, but that has now moved up to around $1.32/litre. The price for Italian Pinot Grigio has been stable, but is still very high compared to all other varietals from that market.

The varietal is the United States second bestselling white, and number three in the UK. Experts are questioning whether a price increase will see consumers switch to another variety - with Sauvignon Blanc being a likely candidate.

The grape is the third biggest selling white varietal in the UK off-trade market according to Nielsen – it sold 65.6 million 9L cases, following Sauvignon Blanc (81.7m) and Chardonnay (66.7m) in the off-trade. However in the past year, growth has declined by 3.4%. Its price is still slightly under the UK average of £5.34, coming in at £5.23, according to Nielsen Scantrack data to July 19, 2014.

The bulk of this volume consumed in the UK comes from Italy. However, the price differential - a litre of Australian Pinot Grigio is £0.65/litre compared to £0.83/litre from Italy, which has obliged buyers to look elsewhere for their Pinot Grigio, in turn pushing up prices in Australia.

In the USA, Pinot Grigio is the second bestselling white grape and accounts for 9% of total sales - and it’s growing. With the US harvest just beginning – and already looking a little short, especially for Pinot Grigio – this could put further upward pressure on prices.  

Australia has  almost tripled the number of hectares given over to Pinot Grigio since 2006, to almost 3,767 hectares. This represent an increase of 28% to 50,000 tonnes between 2010 and 2012. Pricing has risen from AU$0.75 in April 2013 to today’s AU$1.18/litre with very limited availability. Australia mostly exports to the UK and USA.

Anya Robson, of bulk wine broker Murphy Wine Company, told Harpers.co.uk: ”Pinot Grigio is the hot product on the shelves in the US. American wineries can contract and ship huge volumes rapidly, often making them preferred customers for producers. If the shortfall is confirmed in the US, the job of the Italian wine buyers in Europe will be complicated post harvest, if they have not already secured their volumes.  

Nielsen drinks analyst Natasha Kendall told Harpers.co.uk that Pinot Grigio was “declining slightly because of the price increase”, in the past year, which could be linked to limited supply but also to retailers opting for other varieties. “Retailers seem to have moved away from this varietal a little bit (thinking [Sinsbury’s] Mondelli specifically) which alongside [Tesco’s] Ogio and Dino was growing the varietal a few years ago, so the poorer performance this year comes off the back of a stronger performance previously.” 

She said that Sauvignon Blanc “tends to be the ‘trendy’ one” right now, and is attracting a lot of retailer focus.

 

 MAT to July 19, 2014Value £000s% GrowthVolume 000s 9L% GrowthPrice / 75cl% Change

TOTAL LIGHT WINE

£5,485,340

0.7

85587.9

-3.8

£5.34

4.7

WHITE

£2,547,018

1.7

39893.3

-2.9

£4.39

5.7

SAUVIGNON BLANC WHT

£590,778

13.1

8167.0

8.6

£6.04

4.2

CHARDONNAY WHT

£421,254

2.2

6667.3

-0.9

£5.27

3.0

PINOT GRIGIO WHT

£410,940

0.6

6558.3

-3.4

£5.23

4.2

BOURGOGNE WHT

£85,146

-10.0

777.3

-18.7

£9.26

9.7

SOAVE WHT

£62,515

-6.6

1242.4

-9.9

£4.19

3.6

LOIRE WHT

£53,797

6.2

569.4

-1.3

£7.87

7.6

CHARDONNAY/SEMILLON WHT

£42,581

-1.8

677.2

-7.4

£5.31

6.0

CHENIN BLANC WHT

£39,737

1.9

672.3

-2.7

£4.93

4.3

BLEND WHT

£35,332

-17.0

689.6

-22.3

£4.27

6.2

 

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