Wine world di­gests Brexit shock

Decanter - - A MONTH IN WINE -

The wine world is still get­ting to grips with the likely ram­i­fi­ca­tions of the UK vote to leave the Euro­pean Union, with fine wine price rises and in­creased mar­ket share for New World-pro­duc­ing coun­tries among the pos­si­ble con­se­quences (see also Mar­ket Watch, p113).

Wine mer­chants based in the UK re­ported brisk trad­ing from Asia and the US in par­tic­u­lar as buy­ers sought to take ad­van­tage of the fall­ing value of the pound in the wake of the Brexit vote re­sult. Ster­ling’s 31-year low also sig­nalled an abrupt end to the Bordeaux 2015 en primeur cam­paign.

There are fears that UK wine lovers will suf­fer as a re­sult of the UK’s exit from the EU, with the weak pound mean­ing that most Euro­pean wines will be­come more ex­pen­sive in the near term.

Brexit could also of­fer a boost to nonEuro­pean wine-pro­duc­ing coun­tries such as Aus­tralia, South Africa and New Zealand, mak­ing them more com­pet­i­tive against their Euro­pean ri­vals, An­drew Shaw, group wine buy­ing direc­tor for wine dis­trib­u­tor and re­tailer Con­vivi­al­ity, said.

In the longer term, he added, the out­come of trade ne­go­ti­a­tions with the EU could ‘threaten the sus­tain­abil­ity’ of many wine sup­pli­ers in Europe, who are heav­ily re­liant on the UK mar­ket.

Eco­nomic an­a­lysts have also warned that the UK could face re­ces­sion fol­low­ing the vote, dam­ag­ing con­sumer con­fi­dence across the wine sec­tor at a time when con­sump­tion had be­gun to rise again.

Mean­while, the view from Bordeaux was mixed, with much un­cer­tainty and anx­i­ety about the fu­ture. How­ever, Chris­tian Seely of Château Pi­chon Baron owner AXA Mil­lésimes wrote on his blog: ‘In­evitably there will be some short-term tur­bu­lence, but per­son­ally I do not fore­see ma­jor long-term dis­rup­tion.

‘Eng­land and Bordeaux have been trad­ing closely for many cen­turies: the Bri­tish mar­ket has a spe­cial place in the hearts of Bordeaux pro­duc­ers; and Bordeaux equally has a spe­cial place in the hearts of Bri­tish wine drinkers.’

Above: Chris­tian Seely of AXA Mil­lésimes, owner of châteaux such as Pi­chon Baron

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