1 Nov 2013

Wine shortage impact on price uncertain says industry body

1:44 pm on 1 November 2013

The New Zealand wine industry says a predicted global shortage of wine could be to its advantage.

The forecast comes out of research by America's Morgan Stanley financial services firm, which says world consumer demand for wine is already significantly outstripping supply.

It says demand for wine exceeded supply by 300 million cases in 2012, the biggest shortfall in more than over 40 years.

It says with falling European production that will benefit new world wine producers such as New Zealand, Australia, and those in South America, where production has been steadily rising.

New Zealand winegrowers chief executive Philip Gregan agrees that it provides opportunities for New Zealand but the impact in terms of price increases could be limited.

He says there's been a global wine surplus for many many years fuelled by subsidies out of the EU and that is now coming to an end leading to firmer prices.

But he says it's unclear whether that's going to translate to higher retail prices for wine in New Zealand.

He says it could mean price increases for consumers, especially for the cheapest wines.