Europe’s blistering heatwave could cause Old World producers to lose further ground to their New World rivals, buyers have warned.

A parched Italy is among European countries that look set to suffer a drop in wine yields, in its case for the second year running.

Simon Thorpe, central wine buyer at Waitrose, said another low yield harvest would leave producers with “less money floating around and less volume to do promotions, making it harder for wines from the Old World to compete with those from the New”.

Helen McGinn, product development manager at Tesco, said that Italy’s woes had restricted the retailer to sourcing only limited supplies of the Pinot Grigio it launched under the Finest banner, but hoped this year’s harvest would not curb its plans for 2004.

“Italy has had a run of bad years but we have still been able to focus on some good Italian wine promotions,” she said.

“There will be good wine, but buyers will have to work harder to find it.”

She also voiced concerns over the Champagne harvest, anticipating that prices would rise in 18-month’s time because of winter frosts earlier in the year.

In contrast, retailers, including Morrisons, said they expected good results from Germany and some parts of France.

Closer to home, English producers look set to produce some of their best wines in 2003, thanks to prolonged hot, dry weather.