Surging Swiss franc boosts wine trade
The Swiss already spend around €10 billion a year in cross-border shopping – a figure set to rise on the back of a devalued Euro and likely to benefit nearby wine merchants.
Christmas may have come early for fine wine shops in France, Italy and Germany close to the Swiss border, following dramatic moves on the currency markets last week. At one point on Thursday the Swiss Franc was up 41% against the Euro, following the decision by the Swiss Central Bank to allow the Franc to float free. Previously it had been capped at SF1.20 to the Euro. It is currently trading at near parity, some 16% up on the start of the year.
The last time the two currencies were at that level in August 2011, “it cleared out our stock of Bordeaux and other fine wine,” Marianne Fredriksson, who runs one of three Vinotheque stores on the French side of the Swiss border, told Bloomberg, adding that she expected “sales will probably explode again.”
Speaking to the drinks business Jean-Christophe Boudot, who runs the Vinotheque store at Ferney-Voltaire, just 200 metres from the Swiss border, was more cautious. “It’s a bit early to say if this will change things. It’s clear that since Saturday there have been a lot more people, above all at [the supermarket] Carrefour, but we’ll have to wait and see.” At present 50-60% of Vinotheque’s sales are to Swiss customers.
While lower prices should benefit Swiss merchants buying en primeur, the collapse in the Euro will make their existing business harder reckoned Liv-ex director Justin Gibbs. “The biggest players tend to be export players and they’re probably having a bit of a headache right now. They’ll have to work through their current positions on tighter margins than they’re used to.” He added: “the local market’s not huge and people are spoilt for choice surrounded by Germany, Italy and France.”