Suppliers warn merchants of summer price increases

Hallgarten will absorb 44p duty hike on selected wines for a month, but most suppliers will pass it on immediately

As the trade braces itself for the August duty increase that will add 44p to the price of most still wines, suppliers are warning they are in no position to help cushion the blow for their retail customers.

Hallgarten & Novum Wines has announced it will be absorbing the increase, across a selection of 148 of its wines, until September. Other major suppliers to indies have been examining their options, with a few still undecided of their response to Hallgarten’s move as The Wine Merchant went to press.

Most have said that they have been fighting to keep trade prices down for some time and margins are far too tight for them to take the pain on duty. Many suppliers have already put prices up by around 7% in recent months and say that their prices will have to rise again in August simply to reflect the duty increase.

However, there may be some better news on the horizon, with suppliers reporting that inflationary pressures – involving everything from wine shortages to logistics, glass costs, wage rises and foreign exchange – may be levelling off and in some cases easing. ABS reports that the cost of a shipping container from Australia has halved since its last price list appeared.

• Analysis, page 12.