Don’t Panic – There Is No Global Wine Shortage

There is no need to be concerned over the recent media reports of a global wine shortage – the figures have been hyped and the situation exaggerated out of all proportion. Research released by Morgan Stanley set the world’s press ablaze with the news of an impending wine shortage but almost as soon as the research was released it was being successfully challenged.

According to Morgan Stanley Research, an undersupply of nearly 300 million cases of wine in 2012 was going to result in a global wine shortage: “Data suggests there may be insufficient supply to meet demand in coming years, as current vintages are released.” Increasing demand, bad weather and fewer vineyards were apparently to blame. Global production fell by more than 5% in 2012 – its lowest level since the 1960s. However as Felix Salmon, writing for, pointed out Morgan Stanley’s charts and reports on the topic are misleading:

“But if you look closely at the Morgan Stanley report, it starts to look less like a dispassionate analysis of supply and demand dynamics in the wine world, and more like an aggressively-argued attempt to put forward one particular investment thesis as strongly as possible. What’s more, the investment thesis is not, particularly, based on the existence of any present or future wine shortage; it’s simply trying to present the idea that demand for Australian wine exports is likely to rise, and to justify the fact that a company called Treasury Wine Estates is the bank’s “top Australian consumer pick”. (The report was written by Morgan Stanley Australia.)”

However it appears that Morgan Stanley’s research was based on that of the OIV (Organisation Internationale de la Vigne et Vin) and Morgan Stanley omitted the fact that the OIV estimate for 2013 shows an increase in production (for between 7.1% and 10.5% this year). OIV says that world wine production has increased significantly in 2013 while consumption is stabilising.

So what of Morgan Stanley’s predictions? Cosmetic accounting? Selective analysis? Definitely a good headline and certainly an attention grabber.

Either way there is no need to panic. There is plenty of wine to go around!

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