Wine prices look doomed to rise in the wake of a record drop in global production, experts warn.

Unfavourable climate conditions, including particularly bad weather in Western Europe, saw production drop 8.2% across the world this year, according to The International Organisation of Vine and Wine.

Italy, France and Spain were hit particularly badly, recording volume declines of 23%, 19% and 15% respectively. Portugal, Romania and Hungary were the only European countries to grow production year on year.

This means prices will likely surge, particularly at the value end of the wine market, according to Rabobank global beverages strategist Stephen Rannekleiv.

“These tiers tend to be the most sensitive, with the thinnest margins and the least ability to absorb price increases,” he says. “Wineries are always reticent to pass on increases. Once you raise prices you can start to lose volume that’s very hard to get back - but when you look at how much production has declined, something is going to have to give.”

Distributors and wholesalers are looking to source wines from less traditional regions to make up for the shortfall. “We increasingly have to look further afield,” says Charlie Miller, trade account manager at Justerini & Brooks, which started working in the Jura region for the first time this year because of the similarities to Burgundy. Wine prices have already risen thanks to the devaluation of sterling in the wake of the Brexit vote. The price of a 750ml bottle of still wine in the mults is up an average of 18p (2%) across 1,515 SKUs over the past 12 months [Brand View 52 w/e 25 October 2017].

“Discounting and promotional and promotional activity is likely to take a back seat this year to keep pricing as steady as possible,” says Rannekleiv.