An update from our friends in Argentina
Turrentine Brokerage fosters structured strategic relationships with strong brokers in major wine growing regions around the world. Following, is an update from Jaime Lagos of San Nicolas Wine Services, our strategic alliance partner in Argentina, discussing the bulk wine market in Argentina as the 2011 harvest approaches. Please contact Turrentine Brokerage if you have any further questions about the opportunities in the Argentine, Chilean, Australian, Italian, Spanish or French wine markets in addition to the domestic markets.
The wine market in Argentina is quite stable. Grape producers started delivering to wineries in the north (La Rioja), and in one week will be starting in San Juan, two weeks in Mendoza.
There is no clear view about what the final prices will be for the grapes, but it looks like there are enough offers, which shows some tendency toward wine prices maintaining in the beginning and ending the harvest again by taking step by step down.
Volumes and quality are good. This area has less risk of frost and hail than the other provinces, and their production is much more stable. Torrontes and Syrah looks good.
First analysis indicates that this province will have about 17.7% more production than last year; about 767 million kilos of grapes. Sanity is very good! There was some high temperature this summer, but that is usual for this area. There is still some availability of red grapes that some producers can’t commit with wineries.
Looks like this province will have just about 1.7% production over last year, which means about 1.800 million kilos of grapes. This is not been a very hot summer; mainly high temperatures went to 30° to 35 ° Celsius, and humidity has been normal (20 to 50%) and not too many summer rainstorms. The thing that most worries grape growers is the lack of water that Mendoza is suffering from, with controlled irrigation shifts. As there is not much snow on the Andes and all dams have less volumes than average.
There is still some speculation regarding the final production numbers on Uco Valle, where a big frost came in mid November. Will have to wait until the end of March to get a clearer view of the good quality Malbec production numbers. This particular situation combined with the constant increase of demand of Malbec from abroad can push standard Malbecs into higher prices. The rest of varietals should maintain the same as last year prices.
This small production area in Patagonia has always frost risk due to their geographical location, but this year there is no significant issues that can move the average numbers. There is an interesting growing Malbec production there, with good color and natural high sugar wines due to the short fermentation process they have. Wine production is becoming interesting day by day on that location, with nice Chardonnay and Pinot Noirs, obviously besides Malbec.
|Variety||FCA Mendoza Price||Pesos||Tendency|
|Dry White||USD 0,46||$ 1,80||maintain|
|Chenin||USD 0,48||$ 1,90||maintain|
|Ugni Blanc||USD 0,46||$ 1,80||maintain|
|Pedro Jimenez||USD 0,46||$ 1,80||maintain|
|Sauvinon Blanc||USD 0,94||$ 3,70||maintain|
|Chardonnay||USD 0,94||$ 3,70||maintain|
|Torrontes||USD 0,63||$ 2,50||maintain|
|dry Red||USD 0,81||$ 3,20||maintain|
|Bonarda||USD 0,75||$ 2,95||maintain|
|Tempranillo||USD 0,71||$ 2,80||maintain|
|Merlot||USD 0,76||$ 3,00||maintain|
|Syrah||USD 0,96||$ 3,80||up|
|Cabernet||USD 1,10||$ 4,35||up|
|Malbec||USD 1,20||$ 4,75||seriously up|