Regional Manager’s Report: David Kingsbury, Argentina
For this month’s regional manager’s report we turn to Argentina and David Kingsbury who has recently joined the VINEX team. It is key time in the trading calendar for Argentina as we move from vintage to the next, and all sights start to look at what we can expect from the forthcoming 2020 harvest.
How was the Argentine 2019 harvest overall?
The final volume was 2.5m tonnes, which is the same as 2018 and also around the long term average. In general we can say the vintage was characterised by a lack of climatic disasters, so not much hail, frost, wet weather etc to have any big dramatic impact on the grapes and production levels. So overall we can look back on the 2019 harvest as being very consistent throughout all regions and varieties.
Any regions do particularly well in terms of volume?
Not really as it was consistent throughout and we did not see any particular region suffer particularly badly from the weather.
What we did see in 2019 was how much the Valley de Uco has advanced in recent years.Especially the higher regions like Altamira and Gulatalery. Both have become very fashionable and there has been a lot of new plantings there which are now coming on line in what are more premium areas of production.
How about grape varieties? What has done well/ badly?
Again it has been a similar situation to overall production. There has been a consistency throughout and we have good availability of the main grain varieties.
Any thoughts on pricing over the year for bulk wine in general?
Argentina is probably the lowest in the world for bulk wine as the country struggles to work through a surplus of wine of around 350m litres of wine, which it ideally needs to move on before the 2020 vintage comes on line.
Any grape varieties see the biggest changes in pricing in 2019?
Despite the surplus, Malbec has been able to retain a higher price point as the demand for the variety continues to grow.
How has the market been in 2019 in general in terms of availability and pricing for bulk and bottled wine?
They have dropped significantly and wine prices now do not reflect the grape prices at vintage. Necessity to liquidate stocks and make room for the oncoming vintage has had a big impact on the market.
Where have international buyers found the most value in Argentina in 2019?
Generic whites and reds have done well, particularly for areas where transport is still not a limitation. There has been been good demand in Asia and Australia. The interest in Malbec remains high.
What are your predictions for the year ahead in terms of where buyers will get the most value/availability in Argentina?
It is too early to tell how the vintage will pan out in 2020, but some long term forecasts are for unstable and wet weather. Argentina has always been a strong source for generics reds and whites, through to mid-range varietals and I cant see that changing too much.
Some political issues may have some impact, as we are soon to go back to the populist Peronist government that was in power four years ago. In its previous region, the government limited currency exchange, and did not allow foreign owned companies to repatriate profits, and imposed barriers on imports. It is not known what their plans are when they take power on December 10.
Which countries are showing the most demand for Argentine bulk and bottled wine?
Asia, Australia, the US and Brazil.
Any other wider trends we should know about?
There is a continued move towards more premium wines as producers get to understand their regions and terroirs better. Perhaps rather less known is Argentina is the largest producer of grape juice concentrate in the world, and we hope that could become more of an important part of our future business.
* If you would like to contact David you can do so at davidk@vinex.market.