Overview of the Fresh Grape Market in the Netherlands and State of the Most Important EU Producers

Published 2022년 10월 20일

Based on insights from Fernando Dupuis, Tridge’s Origination Manager, there will be a lower volume of grapes in the Dutch market from the Southern Hemisphere, mainly from Chile and Peru, for season 2022/23. Traders are cautious about transit times, logistic costs, and ongoing challenging economic conditions in the EU. Adverse weather conditions, like high temperatures and lack of precipitation, decreased production volumes in the EU. However, the quality of grapes is satisfactory due to less impact of pests and diseases, and winegrowers also expect good quality wine. Conversely, a lower volume of grapes will likely lead to higher prices in the EU market.

According to Fernando Dupuis, Tridge Origination Manager, Dutch importers will proceed carefully with the grape 2022/23 season, especially for Southern Hemisphere grapes from Peru and Chile. Some reasons for caution are long transit times, high logistics costs, and the difficult economic situation affecting Europe. Expectations are that Dutch traders will reluctantly source grapes from the Southern Hemisphere, which could mean a favorable market for EU and other grape producers, at least until W50, pre-Christmas sales included.

EU Grape Production

Expectations are that EU grape production will levitate around 1.4M mt, with Italy increasing supplies buffering weather‐related losses in the other EU Member States. Italy, Spain, and Portugal have slightly increased acreage in seedless grape varieties. In many EU regions, grape harvests started unusually early due to adverse weather, such as drought and high temperatures during the summer. The positive side is that due to dry conditions, the impact of diseases on grapes is minimal, and in general, grapes are in good phytosanitary states. Conversely, farmers are burdened with the high transport cost, packaging, inputs, and electricity affecting the profit margin. Extreme drought years, like 2022, show that farmers have to mitigate the effects of climate change and look for alternative ways to preserve grape production.

Southern Hemisphere Grape production-Chile, Peru, and South Africa

Chile's grape production is expected to increase by 15.03% YoY up to 765,000 mt, rebounding from last year's damaging rains in the central growing regions of Metropolitana, O'Higgins, and Valparaiso. Peru's production is anticipated to continue its upward trend, rising to 700,000 mt due to a combination of favorable weather conditions and the increased output of the vineyard planted in the past years. Higher supplies are expected to drive exports of Chile and Peru in season 2022/23. South African grape production is heading to record volumes due to optimal precipitation and temperatures in CY 2022. With the added quantities from the newly planted varieties, available quantities for export should reach 380,000 mt.

EU Wine Production

EU Member States Wine Production

Source: Agridata European Commission

In Italy, production in MY 2022 is expected to be stable compared to the previous marketing year, around 52.4M hectolitres. Despite adverse weather events, like floods and high temperatures, Italian winegrowers look at the positive side that the lack of rainfall facilitated the control of fungal diseases lowering the need for phytosanitary interventions. One of the most significant wine regions in the EU, France, is expected to increase wine production to 44M hectolitres, a 16.2% YoY increase. Production bounced back after a terrible 2021 season, which was affected by heavy frost damage. Spain’s wine production was also under the influence of high temperatures and floods, and similar to Italy and France will have a shorter harvest season with good quality grapes. Expectations are that Spain's wine production will amount to a similar level as in 2021, around 35M hectolitres. Portugal marks a 9% YoY drop to 6.7M hectolitres due to a lack of precipitation and high temperatures in the ripening stage of grapes. In the Netherlands, dry weather also positively influenced grapes' phytosanitary conditions, and wine production is expected to increase by 10%, up to 8.8K hectoliters.

Conversely, 2022/23 EU wine production is forecast to increase by 1.5% YoY. The final production figures will be determined by water and thermal stress, impacting both the quantity and quality of grapes, while smaller output is expected on the new grape sales.

Top 10 Tradeflows of Fresh Grape-Netherlands

Source: Tridge

Combined with the current political and economic crisis, shifts in Dutch trade patterns are expected. Italian grape producers in the previous season were not competitive in the EU market due to Dutch import saturation with Egyptian lower-priced grapes. Based on Fernando Dupuis's insights, there will be lower quantities of grapes from the Southern Hemisphere due to increased transportation costs, leading to higher prices than last season.