WSTA celebrates LWF return, though "Recovery is not a given"

By Jo Gilbert

Published: 07 June, 2022

The WSTA struck a note somewhere between optimism and realism at the opening briefing of this year’s London Wine Fair, calling for “resilience and resistance” in order to manifest a more fully formed recovery of the wine and spirit trade post-Covid.

“Recovery is not a given,” WSTA executive Miles Beale said this morning as he set the tone for this year’s fair, which is returning to the Olympia for the first time since 2019.

We are by no means out of the woods following “years of upheaval,” he added, with a catalogue of difficulty still looming in the form of duty reform, alcohol labelling and ongoing Deposit Return Scheme (DRS) debates.

If pushed through, the duty review proposals are expected to hit 70% of products, including 90% of red wine and 100% of fortified. The expansion of three to some 27 tiers in the duty hierarchy is threatening to have a “massive impact and tying importers into new red tape”.

It’s arguably the biggest cloud looming over the WSTA and the trade’s joint horizon, with the body now lobbying hard while the reforms work their way through Whitehall channels, with a deadline of February on the horizon.

In reflective mode, Beale gave the scrapping of VI-1s and the exclusion of glass in the DRS for England and Wales as examples of how the trade has remained resilient and resistant amid various challenges. The trade has also seen some encouraging return of balance between the on and off-trades and should be looking forward to the first restriction-free summer since the pandemic and an autumn buoyed by the World Cup.

Considerable hurdles still remain, however. Alongside the duty escalator, which could be the biggest threat to recovery, the WSTA panel also painted a picture of a “challenging environment” characterised by high inflation and rising energy prices acting as unknown quantities on consumer confidence.

With regard to shifting global supply patterns, David Richardson, regulatory and commercial affairs director at the WSTA, drew on the testimony of one business, which he said has switched from a “just in time model, to just in case”. He pushed for greater preparation among businesses when shipping from abroad, while expressing his hopes for a smooth(er) transition from CHIEF to CDS, when migration completes next year.

Hopefully, said Richardson, “CDS will eventually lead to duplication being stripped out the system. Around 70-80% of businesses will use the same codes on a regular basis. The key is to be as prepared as possible and allow for greater lead times.”

Looking ahead, “There’s a lot of noise [affecting the industry],” Simon Standard, director of policy, said. “We’re now tasked with coming up with a roadmap of how the industry can work together to meet some of those challenges, including achieving net zero. That’s going to be really difficult with a fragmented supply chain. But there has been some amazing work by businesses, including many in this room, and with the work of the WSTA, hopefully we will be able to stop firefighting and start meeting some of those [longer-term] challenges.”

Still, the WSTA continues to forge ahead with calls to reform the duty proposals announced at last year’s Budget.

“We’re pushing for two tiers, while the government is pushing for 27,” Beale said. “It’s madness."

Beale also added to Harpers that the WSTA is hosting several MPs at this year’s fair. This is something of a novelty, yet hopefully also a move which will continue to advance the wine trade’s cause inside parliament.

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