Wine prices are set to soar next year as the industry said it had never faced “so many challenges” in the space of a year.
Businesses tried to take on inflationary pressures themselves but have now apparently reached breaking point.
“We have been absorbing everything in terms of cost increases. We haven’t been passing that on,” one supplier told The Grocer.
“Glass is going up. Labels are going up. Even capsules are going up – the inflation at the moment is just frightening.”
READ MORE: Hardys owner warns of wine shortages by Christmas
From January 1 shoppers will “see big changes”, they predicted.
Wine & Spirit Trade Association boss Miles Beale said members had been “buying [stock] forward, trying to keep price inflation from coming through to the consumer in the short term”.
However, this was “likely to change before Christmas”.
Beale continued: “I can’t remember a 12-month period where there were so many challenges in so many regions.”
Nearly every wine-producing area has been rocked by extreme weather this year, with fires across Australia, Southern Europe and the US, plus frost in the northern hemisphere.
In New Zealand, the harvest ended up almost a fifth smaller than in 2020.
“Wineries are having to make tough decisions over who they can supply in their key markets,” New Zealand Winegrowers head Philip Gregan said.
Shoppers and businesses are feeling the early effects of inflation, which is expected to peak around five per cent early next year.
Kantar data from this week showed grocery prices in October hit a 14-month high at 2.1 per cent.
Multi-brand giants Kraft Heinz and Unilever have made “inflation-justified” price increases in the face of soaring labour, packaging and materials costs.
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