Britain’s exit from the European Union couldn’t come at a worse time for Sherry. The trade is worried about the effects it will have on sales to its largest export market in which - at last - the seemingly never ending slide in sales had bottomed out with a rise of 0.6% for last year. This may seem modest – it is – but 0.6% of annual sales in the UK still represents some 60,000 litres.
The UK has witnessed a change of fashion with younger consumers discovering Sherry and especially the traditional dry styles which now drive the sales growth – though the bulk of sales still remain the sweeter styles. These traditional dry styles of wine, along with vintage and en rama are more expensive than the usual British fare like Creams, Pale Creams and Mediums, so while volumes were still falling, income was beginning to rise in compensation.
Now that volumes are rising – albeit slowly – profit is rising too, and just as the bodegas were beginning to reap the fruits of this growth, Brexit has sown the seeds of uncertainty with the fall in the value of Sterling making Sherry exports more expensive. And to make matters worse, there is also a strong possibility of alcohol tax increases in the UK.