Portuguese producers on the ‘brink of bankruptcy’
ANCEVE, Portugal’s association of wine traders and exporters, has urged the government for support as rising costs push the industry “to the brink of bankruptcy”.
ANCEVE has cited “the continued rise in the prices of raw materials, bottling materials, transport and costs in general” as the major reasons for economic instability within the country’s wine industry.
Small and medium producers –”which make up the majority of the business fabric of the wine industry” – risk bankruptcy if the government does not step in with financial support, according to the association.
On 20 July ANCEVE described the need for additional government action as “urgent and imperative”, Portugal Resident reported. The issues have arisen just when the harvest has begun, putting extra pressure on Portuguese wine producers struggling to cope with rising costs.
“Producers only managed to raise their selling prices by around 10%, so the overwhelming majority will show huge losses at the end of the year, if they manage to get there,” the association said in a statement.
ANCEVE criticised the Ministry for Agriculture for its lack of support in a further statement put out yesterday, describing it as “excessively bureaucratised” and “without direction”.
The trade association has listed a number of ways it believes the Portuguese government should intervene, including assistance with investment in barrel and bottle stocks. ANCEVE is also asking for interest-free treasury support, so cooperatives grape buyers can pay growers for their grapes after the harvest, and reinforced support over the price of agricultural diesel, which currently costs €1.80 per litre.
In 2021, all of the top 10 export destinations for total Portuguese wine were on the up, in value terms, but the question of whether producers tackling increased costs with a lack of government support can keep up with demand is still yet to be seen.