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Chile's wine production plummets by one quarter, say official figures

Published:  13 August, 2014

Chile's wine production has plummeted by almost one quarter compared to last year, but experts aren't expecting price rises as the country still has plenty of leftover wine in its tanks.

Official figures from the Chilean government's Ministry of Agriculture say the amount of wine produced has fallen by 22.8% to just under 989 million litres.

ChileChile's 2014 wine production was decimated by frostOfficial figures from the Chilean department of agriculture show a fall of 23% in production in 2014, but experts aren't predicting price increases, given leftover stock from bumper harvests in 2012 and 2013.

Although a smaller harvest usually points to a price increase as supply dwindles, in Chile's case two bumper harvests in 2013 (1.28 billion litres) and 2012 (1.26 billion litres) mean its tanks are well-topped up. Add to that falling demand from one of its biggest markets - the US - and experts say that prices could actually start going down once September comes around.

Imports of bulk still wines from Chile to the US have fallen by 37% for the year to April, 2014, or 19% for all wine imports from Chile, according to a report from Gomberg Fredrikson.

Bulk wine broker Murphy Wine Company's Anya Robson said: "The wineries have big volumes, mainly red wines, in tank from 2013.  Therefore the drop in production for 2014 has not produced the upward pressure on pricing as might have been expected."

The Maule region produced almost half, at 48.2%, of the country's wine. Of the total production, Cabernet Sauvignon made up 35.6%; Sauvignon Blanc 14%; Merlot 11.8%; Syrah 7.9%; Carmenere 7.4% and Chardonnay 6.9%.

Taking a closer look at red varieties, the production of Carmenere fell by 35%, Pinot Noir 24%, Merlot 22.5%, Cabernet Sauvignon by 19.3%, Syrah by 16% and Pais by 14%.

White grapes were hardest hit with Chardonnay production down 38% and Sauvignon Blanc down 26.3%.

A spokesman for Concha Y Toro UK told that the 2014 vintage was "unusual and challenging". "Well-documented frosts in September particularly affected Chardonnay and Pinot Noir in Casablanca Valley and some other central zone locations. Elsewhere there was great variation in average temperatures and consequent ripening times for different grapes from valley to valley. Despite these challenges, during the 2014 grape harvest Concha y Toro's vineyards met both the production and quality expectations.

"In terms of UK impact, we had plenty of advance warning of potential shortfalls from specific regions and were thus able to work with our customers to ensure we were able to assure supply. Unlike others, through our vineyard holdings and long term contracts we actually control a large proportion of our grape supply, and thanks to this and the geographical diversity of our vineyards we weren't too badly affected. There will be price inflation on white varieties in particular but we will be looking to keep this to a minimum." 

Earlier this year, Ricardo Baettig, chief winemaker at Viña Morandé, told that volumes of Chardonnay were 60 to 70% smaller this year, thanks to a recurring early spring frost in the Casablanca valley.

Speaking at the end of June, Mario Pablo Silva, managing director of Chile's Casa Silva winery in the Colchagua valley, said the frost had two different impacts. "Between 30 and 55% of Chardonnay and Sauvignon Blanc grapes were affected on average - that was the first impact and it was huge." Some vineyards saw their white grape crops decimated, with around 90% wiped out, he said. 

The second impact grape growers face is that frost reduced vines' production levels. Silva said the weight of the grapes on the smaller branches has led to an average reduction of 10-15% in red wines. "It wasn't caused directly by the frost, but was a longer-term effect on the branches."