The year ends bringing good news for Argentinian bulk wine. According to a report made by the Argentine Bulk Wine Chamber, the total bulk wine exports corresponding to the Jan-Nov/22 period have registered a year-on-year decrease of 39.8%, measured in liters.
While foreign sales of varietal wines registered a decrease of 19.2% in volume, and 74.3% for generic wines. During this period, the total volume exported has increased up to 64.7 million liters and the total amount of dollars generated by this business unit totaled 55 million dollars.
Considering this, the participation of varietal wines over the total exported continues to increase, representing 84% for the period under study, which implies an increase of more than 21 percentage point compared to the previous year, and in line with what was registered throughout the 2018-2021 period, where the participation of varietal wines went from 32.5% to 62.7%.
This reflects a continuous and growing premiumization of bulk wine exports, with higher shares of varietal wines over total sales, such as Chardonnay; Pinot Gris and Syrah.
“We are finishing the year with some 70 to 71 million liters of bulk wine exports, especially varietal wines, with an increase in values, which means that the sector has been responsible for entering around 60 million dollars into the country”, highlighted José Bartoluccithe, president of the Argentine Bulk Wine Chamber.
Growing demand for varietal wines
Taking into consideration the most exported varieties, Malbec continues to be the most relevant figure, with a participation of 74% of the total mono varieties exported during the year 2022. It is followed in importance by Chardonnay (10.7%) and Torrontés Riojano (3.3%).
Analyzing the increase in the participation of monovarietal wines in total exports, Malbec stands out with an increase of almost 9 percentage points in relation to the same period of the previous year, followed by Chardonnay with an increase of 3 percentage points. In relation to the monovarietal wines that experienced the greatest drop in the share of total exports, Syrah and Cabernet Sauvignon stand out, with drops of 4 and 3 percentage points respectively, in relation to the same period in 2021.
Regarding the average prices registered during 2022, it can be seen that the monovarietal wines that registered the highest year-on-year increase were: Syrah with +66% (0.82 USD/l.) and Chardonnay with +29% (0.93 USD /l.). While Malbec rose to an average value of $0.97 USD/Liter, which represented an increase of 2.6% year-on-year.
A great representation of the members of our Chamber
The companies that are part of the Argentine Bulk Wine Chamber have made up 26.4% of total Argentine bulk wine exports in 2022, having a more representative participation in generic wines (72.5%) and a lower one for varietal wines (17.7%). During this period, operations were registered by 68 companies, 18 of which are part of the Argentine Bulk Wine Chamber.
During this year, exports to 33 countries were registered, while in 2021 this figure rose to 31 destinations. This year, the destinations that experienced the greatest increase in the share of exported volume were: the United Kingdom (+13.3%) and the United States (+12.2%). While the destinations that lost relevance in foreign sales were: China (-13.8%) and Canada (-10.9%).
In this way, the 3 main export destinations, the United Kingdom, the United States and Germany together represent 70% of the total Argentine bulk wine exports, for which the 93% of the total was represented by varietal wines.
Prospects for 2023
Due to the frosts we had in November, which have affected the provinces of Mendoza and San Juan, as well as some other wine-producing regions of the country, a smaller harvest is expected for the following year. Up to now, there is no evaluation of the actual percentage of damage, which will be known once the harvest begins.
Meanwhile, prices are generally established at the time of harvest, which is why, as a lower amount is expected than that of the previous year, together with persistent inflation expectations, rising prices are expected, depending on the needs of each company.
The prospects allow us to expect a very important internal demand, since Argentina is a great wine-consuming country and next year we are going to absorb a large amount of what is produced internally.
This year internal consumption remained steady and is of the order of 20 liters per capita, which means that the Argentine internal market continues to be very strong, and demands between 70% and 75% of the wines we produce in the country. The high level of inflation registered during the year and high expectations of future inflation generate great uncertainty and have a permanent impact on domestic prices.