Wine Quarterly Q2 2022: Is Wine Facing a Tectonic Shift in Supply Chain Assumptions?

The global wine sector is facing significant disruptions in different links of the supply chain. The common assumption was that these issues were transitory. Now there are increasing signs that some of these changes are structural and could even get worse, requiring more strategic responses.

Report summary

Since the middle of 2021, at least five aspects of the global wine supply chain (agricultural production, freight, labor, geopolitics, and energy) started to face significant disruption all at once, causing wineries around the world headaches. The common assumption was that disruptions were transitory, and responses were mainly tactical in nature. 

In our view, there are increasing signs that some of these changes are structural and could get much worse. The global wine industry has come to rely on inexpensive freight, low trade barriers, and cheap energy – all of which are being called into question.

Pricing actions have been wineries’ first and most obvious line of defense to try to maintain margins. But as consumers face rising cost pressures for numerous basic staples, (even as input costs continue to rise), other more structural/strategic responses may be worth considering. These could include complete rethinking of packaging; shifting more of the supply chain operations closer to the end consumer where possible to improve efficiency; and diversifying (of markets and/or sourcing) to help mitigate geopolitical risks.


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