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English News Mercoledi 03 Agosto 2022

Wine Prices: the raw materials’ price increase does not stop the GDO depreciation

Facing a global crisis without precedent, the wine sector keeps giving positive signals in countertrend compared to the other compartments but, at the same time, on the GDO shelves we can observe low prices difficult to justify.

di Fabio Piccoli

In the past few days, I entered in a well-known GDO chain of stores in the Verona province. As always, because of professional deformation, I stopped between a particularly supplied wine shelf.

I was truly curious to verify if the actual raw materials price increase that are strongly affecting our wine companies, were already influencing the final prices of the bottles on the shelves.
Not only I did not notice any price increase (and, believe me, I observed carefully, so much that my children could not bear to be inside the supermarket any longer), but I even saw truly impressing discounts that I rarely observed in the past.

I saw many wines below the 2 Euros threshold – which I call paradoxical – (of which water becomes an interesting competitor), not to mention the limbo between the 2 and 4 Euros, where also a few prestigious denominations reside.
It is truly difficult to find a justification to prices of this nature. If it were already unintelligible before this complex phase, today it appears to be absolutely unjustifiable.

A few weeks ago we recalled the complaint moved by the Friuli Venezia Giulia’s producer Antonella Cantarutti (you can read the article at this link), who even wrote to the Minister of the agricultural politics and to the her region’s council member to explain the absurd promotion of the Ribolla Gialla spumante led by a distribution chain for a price of 1,99 Euros.

I have never loved the demagogy on the wine price matter. I am not so naïve to not comprehend that the Italian production chain is rather composite and that there are prices’ range that are relevant to our denomination and to many of our wine typologies.
To some extent, I find that inevitable.
But under certain thresholds it becomes truly impossible to find reasonable reasons for this phenomenon; the only option is to report strongly these drifts that risk not only to make the production economically unbearable for many companies, but also to generate a dramatic debasement of the wine image to the consumers’ eyes.

I tried anyway to find some justification to the actual sales and I think that it can be relied, at least to some extent, to an “empty stock” strategy adopted by some bottlers who, before modifying the wine prices, decided to sell cheaply and massively many of their products.
Seen from this perspective, it can be considered a contingent phenomenon, some sort of decrease before the great price increase: “Dear clients, get wine provisions because shortly the very same wines will have different positionings”.

But, regardless of the real motivation for these prices, there is no doubt that the theme of the low positioning of many of our wines keep representing one of the main problems of our sector.
Therefore, the challenge of the value keeps being the “mother of every battle” for the Italian wine production chain. It is true that some things have changed in the last few years but there is a long road ahead and, in this direction, we expect many more protests by the producers.

Instead, with deep sorrow but also with surprise, I find it truly unintelligible the silence carried out by most producers, starting from the smallest that are also the most penalized ones.
The very same protest of the brave Cantarutti has basically been one isolated voice.

Of course, we can comfort ourselves with producing countries that do worse than us, starting from Spain.
In fact, in the very same supermarket I found a bottle of Cava for 2,50 Euros, and, it wasn’t even that bad.
However, if we need to console ourselves in this way, it implies that we are in a poor situation.