Pernod Ricard’s wine business, which includes New Zealand wine brands Brancott Estate and Stoneleigh, has announced it will be unable to meet global Marlborough Sauvignon Blanc supply this year after one of the smallest New Zealand harvests in 10 years.

Extreme spring frost events significantly impacted yields following an earlier than normal budburst. Bunch sizes were also down, impacting juice extraction levels.

Pernod Ricard revealed it has 34% less Marlborough Sauvignon Blanc this year compared to the 2020 vintage, which was already lower than long term averages. The lower volumes are also leading to increased costs, which is being compounded by increased input costs and ongoing labour shortages due to the closure of borders in New Zealand. Shipping costs are also at the highest level since the global financial crisis, which has added an additional layer of expense to operations.

Bryan Fry, Chief Executive of Pernod Ricard Winemakers, said: “The reality is that we are not going to meet the demand of Marlborough Sauvignon Blanc this year. Being an agricultural industry, the weather can be unpredictable, and periodically we do experience extreme weather events. This year’s small Marlborough Sauvignon Blanc vintage is going to result in significant supply challenges for the short term, but with the popularity of Marlborough Sauvignon Blanc continuing to rise we are confident we will bounce back. Our primary focus now is to maximise the supply we have got and hold our listings on shelf.  

“It is also important to note that whilst this season’s crop size has been impacted, the grape quality is exceptional and offers intense regional characteristics, and we are expecting to produce some of the finest Marlborough Sauvignon Blanc wines in the last decade. Our priority is to continue to make exceptional wines in a safe and sustainable way and fulfil demand to the best of our ability.”

Pernod Ricard’s wine price differs from retailer to retailer and the business will be reviewing the prices for vintage 2021, as well as reducing promotional activity.

Sauvignon Blanc accounts for 86% of export volume from New Zealand, with the UK (29%), US (27%) and Australia (23%) being the largest export markets.

Pernod Ricard is the second largest supplier of New Zealand Sauvignon Blanc in the UK, where it holds a 14% value and volume share of the New Zealand Sauvignon Blanc market.