Wine body confirms threat of Russian ban

11th August, 2014 by Neal Baker

Australian wine producers should “prepare themselves” to be affected by Russian trade embargoes, according to the country’s Grape and Wine Authority.

Russian Prime Minister Dmitry Medvedev last week announced the Russian import ban on certain foods from the West, sparking fears of an extension into alcohol products (Photo: Wiki)

Russian Prime Minister Dmitry Medvedev last week announced the Russian import ban on certain foods from the West, sparking fears of an extension to alcohol products (Photo: Wiki)

Steve Guy, the AGWA regulatory manager, told Australia’s ABC network that the Russian market is “one that we would hope to be able to grow and of course you can’t do that if there’s a ban on exports.

“It’s a niche market for some companies, and certainly not one we’d want to lose.”

One million litres of Australian wine are sent to Russia each year, a small fraction of the 678m litres Australia’s winemakers export globally, according to figures obtained by the broadcaster.

But Guy stressed that Russia is a higher value market compared to other importing countries; returning $4.60 (£2.54) per litre compared to the global average of $2.60 (£1.44) per litre.

He also emphasised that Russia’s recent allegations against Georgian and Moldovan wines – claiming that they are dangerous and even poisonous – is an example of what could happen if tensions continue to escalate between the West and Russia.

“These were spurious allegations. At least… the Russians are being transparent about their motivations,” he said.

This was in reference to the current ban imposed by Russia last week on certain foods and agricultural products from the EU and other nations such as the US, Canada and Australia.

Exports of wine and spirits are under threat as Russia has already begun banning certain brands and wine regions, claiming risks to health and safety

Exports of wine and spirits are under threat as Russia has already begun banning certain brands and condemning some wine regions, claiming risks to health and safety (Photo: WIki)

In the UK, the Wine and Spirits Trade Association told the drinks business that, while “wine and spirits are currently exempt from the list of sanctions”, the trade body is “in co-operation with European trade bodies” and are currently “monitoring the situation closely” to ensure that the country’s drinks producers are prepared for any eventuality.

Sazerac’s Kentucky Gentleman Bourbon was recently treated to the same health claims as the eastern European wine regions, as Russian consumer authorities claimed recently to have found harmful chemicals in the US-made spirit, imposing a ban in the interests of “sanitary and epidemiological welfare”.

This is indicative of the threat that is also faced by spirits producers hoping to stay in the Russian market.

Primary among these are makers of Scotch whisky, who have been enjoying steady growth in the country over recent years. They stand to lose significantly if the current ban extends to Western alcohol products.

Direct exports of Scotch Whisky to Russia were worth just under £25 million in 2013, according to the Scotch Whisky Association (SWA).

However, direct exports to Latvia were up 48% to £79m last year, and to Estonia they were up 28% to £69m. Due to route-to-market networks, much of those exports are shipped onto Russia, showing the steepness with which demand has been growing there in the last few years.

An SWA spokesperson told db: “Current sanctions are not affecting imports of Scotch Whisky. However, we are closely monitoring the situation and any potential restrictions, in liaison with the UK Government.”

Leave a Reply

Your email address will not be published. Required fields are marked *

Subscribe to our newsletters

Job vacancies

European Brands Sales Manager, Field Sales Managers and Executives

Amathus Drinks PLC
London, Brighton, E Sussex/Kent, Cornwall & Devon, GB

Commercial/Sales Manager

Crush Wines Ltd
Bremhill/Home office, GB

Wine Buyer

Southwold, UK

Sales Manager - Scotland

Eurowines Ltd

Sales Manager - North-West England

Eurowines Ltd
North-West England, UK

Sales Manager - London

Eurowines Ltd
London, UK

Key Account Manager - Grocery

Australian Vintage Limited
London (Croydon), UK

Key Accounts Manager - Impulse

Australian Vintage Limited
London (Croydon), UK

Business Development Manager

Regency Wines Ltd
North Devon & Somerset, UK

Sales Manager - North East England

Eurowines Ltd
Within 15-20 mile radius of York, UK

National Account Manager

Ehrmanns Wines
London, UK

London Account Manager

The Drinks Club
London, UK

London Sales Executive

Gourvid Limited
London and Greater London, GB

Logistics Administrator

Speciality Drinks Ltd
Park Royal, London, UK

Head of Sales - Hush Heath Estate

Hush Heath Estate
Kent/ London, UK

The Global Merlot Masters 2017

Deadline : 2nd May 2017

db Awards 2017

Deadline : 3rd May 2017

The Global Organic Masters 2017

Deadline : 2nd May 2017

The Global Sparkling Masters 2017

Deadline : 12th May 2017

Click to view more

Global Chardonnay Masters 2016

Now in its fourth year, the competition will identify the best Chardonnay from all around the world in every price range.

Rioja Masters 2016

Now in its fifth year, the competition will recognise and reward the finest Riojas on the world stage.

Fortified Masters 2016

Now in its third year, The Fortified Masters will reward the best fortified wines on offer.

The Global Malbec Masters 2016

the drinks business is proud to announce the inaugural Global Malbec Masters 2016.

Click to view more