The UK market is in danger of becoming unattractive to global wine businesses according to Constellation Europe vice-president Simon Thorpe MW.
The news comes on the back of Foster's EMEA announcement this week that it is to stop exporting some of its brands to the UK because it is more profitable to sell them elsewhere.
Thorpe said that margin squeezes, low price points and tough retailing conditions were making more lucrative markets such as the US and Asia attractive to global wine companies.
"The issue now is about global profitability," said Thorpe. "We are no longer in a position of global oversupply and this is bringing things to a head. Businesses with global reach have to see where the most profitable business lies."
Foster's EMEA senior communications manager, James Craig-Wood, confirmed the company would stop selling its Australian Coldstream Hills and New Zealand Matua Valley wines in the UK in favour of markets such as Australia where they could get a better price.
"We will continue to sell Australian wines in the UK of course and brands such Wolf Blass and Penfolds will be unaffected," he said. "Coldstream Hills and Matua Valley are just two niche, boutique brands that don't sell much volume in the UK and we can obtain a better margin in other markets."
Last year Foster's EMEA introduced Chilean and South African wines to its previously all-Australian Lindemans range and raised its focus on the Old World with a UK push for its Italian Gabbiano brand. The moves were part of a strategy to create a more global portfolio, the company said.
Meanwhile, Constellation Europe this week announced new plans to concentrate on the £6-plus segment of the UK market to grow its business. It has completed a six-month review of its premium business and chose 13 of 35 premium producers to focus on in the UK. The company is also employing a director of premium wine and a dedicated sales team.