Argentina’s White Grape Juice Concentrate (WGJC) supply could be down 25% this year as its crop endured a cruel winter.
The world consumes between 250 and 300k tonnes of WGJC each year; it’s a key ingredient in various foods and beverages.
Argentina is one of the main suppliers, exporting between 135 and 150k tonnes.

Argentinian White Grape Production Could Weaken After a Cruel Winter

WGJC is a common ingredient in a range of sweet food and beverage products, including Ocean Spray’s Cran-Grape, Jelly Belly’s Chewy Candy, and Starbucks’ Very Berry Hibiscus Tea Refresher.
The main producers are Spain and Italy (in the Northern Hemisphere), along with Argentina, Chile, and South Africa (in the Southern Hemisphere).

Argentina often exports between 135 and 150k tonnes of WGJC to the world market each year, but its supply could reduce by 15-25% this year following the cold weather in some regions last October.

Its grape harvest is due to commence at the start of March, so we’ll be monitoring its progress closely.
Fortunately, its harvest has not been impacted by COVID-19.
In some countries, such as Spain, we’ve seen harvests get delayed as workers were unable to access the fields due to the measures put in place to curb the spread.

Demand for grape-based products has also held strong throughout the pandemic; in fact, Argentina’s wine industry actually registered improved global demand.
It entered 2020 with 495m litres and 215.9m litres of red and white wine respectively; these stocks had seriously declined by the second half of the year.
However, each year, the Argentinian Government decides how much grape it wants going towards wine versus juice; 26% of its grape was assigned to the juice industry in 2020.
The 2021 quota has not yet been defined, but the country’s low wine stocks, coupled with the heightened demand for it during lockdown leaves processors wondering how much grape will be allocated towards juice this year.

What Would Lower Argentinian Production Mean for Global Trade?

Argentina exported 135k tonnes of WGJC in 2020, up 4k tonnes year-on-year.
Most of this went to the USA, Saudi Arabia, Japan, South Africa, Canada and Thailand.

These countries would usually import Apple Juice Concentrate (AJC), but the two products are interchanged depending on price; it was cheaper for them to import Argentinian WGJC last year.
Despite this, Argentina faces heavy competition from Spain this year.
Although there were personnel issues due to COVID-19, the Spanish grape crop received plenty of rain and sun last October.

With this, its crop should be slightly larger year-on-year, increasing its export availability and competitivity on the world market.
Argentina’s weaker supply means producers will likely seek higher prices, as they have less to sell.