US fine wine sales should pick up this year according to a major bank’s report.
Trading down in US wine sales will end this year, ushering in an 8-12% surge in fine wine sales, according to Silicon Valley Bank (SVB).
The bank, which specialises in commercial banking services for premium wine companies, predicts improving trends in luxury buying behaviour, corporate entertaining and white tablecloth restaurant sales.
Rob McMillan, author of the bank’s Annual State of the Wine Industry Report, said that extreme price cuts were becoming less common, but warned that not everyone would have a good year in 2010.
‘Those wineries selling on allocation, large-scale producers or established brands in wide distribution are better positioned this year,’ he said.
‘Moderate scale and non-allocated wineries selling above US$50 a bottle will again find 2010 a difficult year.’
SVB, which defines ‘fine wine’ at US$20-plus per bottle, said its optimism was tempered by ‘persistent financial and economic hurdles’.
The bank is also concerned about the impact on profitability of high grape costs and increasingly prevalent trade discounts across the sector.
Written by Richard Woodard