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Global wine production falls to lowest level since 1961

Global wine production has plummeted to a 63-year low after frost, heavy rains and drought ravaged vineyards throughout 2024.

New figures from the International Organisation of Vine and Wine (OIV) suggest that global wine production will reach just 231 million hl this year.

Giorgio Delgrosso, head of statistics at the OIV, said: ‘This would represent a 2% drop from the already historically low 2023, and a 13% decline compared to the last 10-year average.

‘To find a smaller vintage than 2024, we must go back to 1961. The reasons seem quite clear: climate variability, with frosts, heavy rains and droughts, has severely impacted production.’

Lowest output in 20 years for the Southern Hemisphere

The OIV already has a clear picture of wine production in the Southern Hemisphere, which is estimated at 46 million hl for 2024. That represents a 2% drop compared to 2023, and it is also 12% below the five-year average, making it the lowest output in the last 20 years.

Argentina was the outlier, as production increased by 23% to 10.9 million hl. Elsewhere, volumes are up 5% to 10.2 million hl in Australia, but that is still 16% below the five-year average, and excessive rainfall remains a key issue Down Under.

Chile experienced a sharp decline, with production down 15% year-on-year to 9.3 million hl, reflecting the effects of a cool spring and drought pressures.

Meanwhile, extreme weather has taken its toll in South Africa. Production is projected at 8.8 million hl, a 5% drop from last year, as the country was impacted by severe flooding and high disease pressure in several wine regions.

New Zealand and Brazil both saw declines too, with production in both countries significantly impacted by unfavourable weather.

Declines predicted in the Northern Hemisphere

The data from the Northern Hemisphere is still fresh, as the harvest has just concluded, but significant declines are anticipated.

In the EU, production in 2024 is expected to be 11% below the five-year average at just 139 million hl. ‘If confirmed, it will mark the lowest production level of this century,’ said Delgrosso. ‘Adverse climatic conditions played a major role, with droughts, heavy rains and storms affecting vineyards across the region.’

Italy has reclaimed its position as the world’s largest producer, with an estimated production of 41 million hl in 2024. This represents a 7% increase from last year, but it remains 13% below the five-year average.

France saw a 23% decline to 36.9 million hl, which marks the lowest level since 2017. ‘The decline is linked to adverse weather throughout the whole growing season, including continuous rain, disease outbreaks and drought in many key wine regions,’ said Delgrosso.

Spain is expected to produce 33.6 million hl, an 18% increase from last year, but still slightly below average. Hungary, Georgia and Greece are expecting strong years, but there were sharp declines in most other countries, including Germany, Portugal, Romania, Austria and Switzerland.

The United States, which is the fourth largest wine producer globally, is forecast to produce 23.6 million hl, down 3% from last year, but in line with average production volumes.

Overall, worldwide production volume is forecast between 227 million and 235 million hl in 2024, with a mid-range estimate of 231 million hl.

Delgrosso said: ‘These trends highlight the growing impact of changing environmental conditions to the wine sector, underscoring the urgent need for adaptive strategies and resilient viticultural practices.’

Production versus demand

However, the reduced production may help to ease the current oversupply crisis that has gripped the global wine industry.

OIV figures show that production outstripped demand by 10% in 2023, which has pushed prices down and threatened the livelihoods of winemakers around the world.

Delgrosso added: ‘On a more positive note, in the first seven months of 2024, global wine trade recorded a 2.7% increase in volume, and a 2% decline in value, reflecting potentially rising demand and reduced inflationary pressures, which could support consumer spending and reduce producers’ costs.

‘At the same time, producers’ inventories in countries like Italy and Spain showed significant year-over-year declines by the end of July 2024. This is a consequence of the small 2023 vintage, but it could also suggest a better alignment between supply and demand in certain countries.’

The OIV is celebrating its 100th anniversary this year, and director general John Barker reflected on the sector’s resilience.

He said: ‘It has weathered depression, prohibition, world wars, the oil crisis of the 1970s, the stock market crash of the 1980s, the global financial crisis of the 2000s, Covid, etc. It has survived, and it has grown in value.

‘Change is a constant. The global wine sector has undergone significant transformations in production methods, market structures, geographies and consumption patterns over the last 100 years.

‘Production and consumption are always evolving. There’s a never-ending waltz by which production adapts to consumption, and consumption responds to production over time.

‘The wine sector is a long-term sector. It is essential to have a long-term view. This is undoubtedly a tough moment for many in the wine sector.

‘It’s a moment of change and therefore uncertainty, [but] we should look at the resilience, the adaptability, the quality and the global reach of the sector with optimism. The key challenges – addressing sustainability and climate change, understanding shifting consumer behaviours and the position of wine in society, navigating global trade uncertainty – are also the opportunities for wine.’

Barker added: ‘Consumption in the last couple of years has been heavily impacted by inflation. Inflation is now easing off, which may [positively] affect consumption.’

However, he warned that ‘the impacts of climate change are accumulating, and this can clearly be seen in the rising volatility of production volumes. Addressing climate change and sustainability are crucial to the future of the sector.’


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