Bordeaux has two years’ worth of wine sales in stock

Friday March 27 2020 by Vitisphere

Over the first six months of the 2019-2020 marketing campaign, the CIVB registered 766,200 hl of bulk wine purchase contracts. This is an increase of 21% compared to August 2018-January 2019.Over the first six months of the 2019-2020 marketing campaign, the CIVB registered 766,200 hl of bulk wine purchase contracts. This is an increase of 21% compared to August 2018-January 2019.

The Bordeaux wine industry is champing at the bit as winter turns into spring. “Nothing is happening at the moment, absolutely nothing... We're not making any progress ... There are not a lot of new things being done”, sighs the owner of a Médoc chateau. Due to sluggish sales over the last two years in Bordeaux’s main markets – particularly France and China - “ex-winery sales are at an all-time low”, stated a recent memorandum issued by the Bordeaux wine council CIVB. Predicting winery sales of 4 million hectolitres from August 2019 to July 2020, the council expects winery-held inventories to weigh in at 8.5 million hl at the end of the current marketing campaign. This represents an 11% year-on-year increase in stocks. “Expressed as the number of months of wines released for sale, [the stocks] would represent 25 months of sales, a level that has never been reached over the last twenty years”, warned CIVB analysts.

The level of inventory is fairly low compared to the past, but it is proportionally high in relation to marketing capacity”, summarises one negociant. “Having stock is a short-term burden, but it's also cash flow that can come in later, when the markets finally recover. The coronavirus is not going to last forever... The issues are for those who don't have broad enough shoulders to hold out until the recovery. Inventory projections are an illusion”, says one optimistic Bordeaux winegrower.

 

 

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