As Europe’s vineyards continue to suffer from scorching temperatures and heatwaves, the cost of wine might increase by 10% this year.
A bottle of red or white wine from popular countries France, Italy, and Spain will only get more costly if the heat wave and drought persist for an extended period of time, according to David Gates, CEO of Direct Wines and parent business Laithwaites.
According to official statistics, prices for both wines and spirits have already increased by more than 6% in the previous year, as the cost of living crisis and inflation continue to squeeze British consumers’ wallets.
But Mr. Gates worries that a further rise of 4% by the year’s end is now likely.
Due to the effects of the heat on harvests, olive oil prices are also rocketing at the same time.
The price of the crucial culinary ingredient, which is sometimes described as “liquid gold” by the nations that export it, namely Spain and Italy, may increase by as much as 25% before the year is through.
According to Mr. Gates, hot temperatures and little rain often result in poorer yields, which raises pricing.
Additionally, owing to supply chain and energy cost difficulties, the price of all dry products has increased dramatically.
This includes commodities like bottles and cardboard.
The British wine business would suffer another setback if prices were to rise further, since the planned alcohol duty reforms are expected to raise bottle prices by an average of 65p.
The government’s proposal, which is set to begin in February, would tax alcoholic beverages according to their alcohol level, which means red and white wines, which are often higher than 11%, might be among the worst impacted.
Wine merchants, Mr. Gates said, were “under constant attack from inflationary pressure; staff pay, energy, transportation costs, raw materials, and recycling expenses.”
It happens at a time when warmer temperatures throughout Europe are forcing winegrowers to harvest earlier this year.
It indicates that they are generating far less than normal; many in Spain anticipate a 25% decrease in productivity.
Castilla-La Mancha, Spain’s biggest wine area, agricultural minister Francisco Martinez Arroyo said the reduced yield was good news for merchants because “the wine would be able to sell better and at a decent price.”