These days, it’s no surprise that Italian winemakers are kept up at night by nagging questions about energy costs, availability of raw materials and their rising prices, worker shortages, logistics, and the biggest challenge of all — international consumers and their changing habits during economic volatility and unpredictability.
Add to that blend the war in Ukraine, Putin’s weaponization of energy and food prices, the rise in Covid cases across Europe, Asia, and the U.S., record-high inflation, and Europeans’ growing uneasiness about the economy and their concerns about climate change… It’s not a pretty picture.
Last week, the editors at WineNews.it, the Montalcino-based wine industry digital magazine, asked leading Italian winemakers to share their concerns as some of the hottest summer temperatures on record are stoking fears of a diminished crop this fall.
The following are my excerpted translations of some of the more compelling comments. Check out the entire piece, worth reading in its entirety, here. (And hats off to the writers at WineNews, who consistently deliver great content about the Italian wine industry.)
Price increases “on the energy front as well as for raw materials, from glass to paper, have led to a hike in production costs, which were already extremely high,” said Caterina Dei of the Cantine Dei group in Tuscany. “We also need to keep in mind that we will be producing less with the next vintage. This means that margins are even tighter.”
“With cost increases,” said Stefano Capurso, president of the Dievole group in Tuscany, “it’s relatively normal that the costs on our price lists would also increase. But for certain wines, like mid-tier products, there is the risk that in many markets, those products will no longer be priced accordingly. As a result, they won’t end up in consumers’ shopping carts. In the U.S., for example, a Chianti Classico that used to cost $21 is now $25 on the shelf, if not more. There is the risk that American consumers will turn to alternative types of products.”
“Inflation that is running rampant, together with production costs and the growing prices for raw materials,” said Andreo Lonardi of the Bertani winery group, “these are the big issues in 2022. As a result, we are not only talking about increases on our price lists. We are also concerned with consumers’ buying power.”
The price of raw materials, noted Michele Bernetti of Umani Ronchi in the Marche, “is something that needs to be monitored. But there are other industries, like construction, where we are also seeing a slowdown in price growth. And the costs of certain equipment used in the vineyard are beginning to come down as well. Let’s hope that the bubble has peaked and that now we are getting back to normal.”