A bloodletting. While Italian and French wine producers cut prices in an attempt to absorb US tariffs and maintain market positions, wine prices on the US market are rising, swelling the margins of importers and distributors but penalising sales.
This is the denunciation of the Italian Wine Union, which today held its national council in Rome. A bitter denunciation because it represents the realisation that the efforts made by European wineries are being thwarted by the US trade. And in this way instead of sustaining consumption (the Made in Italy vignerons were counting on a boost in sales at thansksginving), sales remain at the pole.
“We have to manage the problem of tariffs,” commented the president of the Italian Wine Union, Lamberto Frescobaldi, “unless there are unlikely and sudden changes of direction in US policies, we will unfortunately have to live with these tariffs. What cannot last long is the self-taxation operated by Italian and European wine companies in order to remain competitive on the market.In the third quarter, the price of Italian wine bound for the US suffered an average cut of 15%, and that of French wine even 26%. At the same time, the average price of these wines coming out of US distribution went up by about 4/5 points in October, and point-of-sale orders in the run-up to Thanksgiving have all but recovered”.
The scenario of heavy market tensions is there for all to see. “The wine world, however,” Frescobaldi added, “must today avoid catastrophisms but also easy optimism and work on crisis management. The allocation of 100 million euro in additional funds for the promotion of Made in Italy (in the hands of Ita, the Italian Trade Agency) included in the Budget Bill is therefore a positive and concrete signal from the Government, provided that our sector is at the top of the list of Made in Italy products to be supported. It is also fundamental that the US trade be aware that no one at this stage can think of profiting in spite of their partners: nowadays the imperative is to reactivate consumption by lowering prices. Because,” concluded the UIV president, “if until a few months ago every dollar invested in European wine generated 4.5 on the stars and stripes market, today the multiplier could be inverted, with the risk of loss of earnings for the American market 4.5 times greater than ours”.
Resources that it will be important to deploy in market diversification in a path of growth and long-term presence. “Also for this reason,” added the secretary general of the UIV, Paolo Castelletti, “we trust in the extension of the time constraints of the CMO promotion measure from the current 3 to 10 consecutive years for activities in the target countries.
Dining and Cooking