labels: World economy
Broke Europe finds wine losing its flavour news
09 April 2009

As the world comes to terms with the recession, the wine industry has for the first time recorded a decline in consumption and sales - particularly in European countries that are traditionally the largest producers and consumers of wine, such as France, Italy, Spain, Germany and the UK.

On the other hand, consumption in the US, Canada and the rest of the Americas increased in 2008, according to the International Organisation of Vine and Wine. But the growth was not enough to offset the drop elsewhere.

The overall drop isn't too dramatic: The group says its initial estimates for 2008 show consumption down 0.8 per cent, at 243 million hectoliters (6.4 billion gallons) compared to 2007's 245 million hectoliters. But the latest figures on wine making and drinking around the world reveal a few key shifts. 

New World drinkers are still sipping steadily and Brazilians "are really starting to believe in the vine'', it said. Argentina and Chile also continue to be major consumers.

For the first time, the United States surpassed Italy in terms of total wine consumption, with 27.3 million hectoliters compared to 26 million for Italy. On the vineyard end, European vineyards accounted for less than half the world's grape production for the first time last year.

"It is obvious that the world economic crisis has played a role in lowering overall demand," the organization's director, Federico Castellucci, said at a news conference in Paris. 

Wines from the New World - Argentina, Chile, South Africa, Australia, New Zealand and the United States - saw their share of global wine exports rise to nearly 30 per cent, up from an average of 23.3 per cent between 2001 and 2005. Italy remains the world's largest wine exporter measured by volume, although France keeps the title of biggest wine exporter in terms of value, Castellucci said. 

Castelluci, whose family has made wine in the Marches region of Italy for three generations, remained upbeat. "I'm an optimist, especially for the mid and upper mid-level quality wines with a very good price-to-quality relationship," he said.

In Britain, the organisation estimates that the drop was from 302 million gallons to 296 million gallons, or 1.8 per cent. This equates to a drop from around 1.8 billion bottles to 1.79 billion bottles. It also means that, on average, the British are drinking 90,000 bottles a day less.

French production drops
On the production front, areas under vine cultivation have also posted a decrease globally of 28 million hectares, with the drop coming mostly from Europe, particularly France. Despite this, global wine production in 2008 recorded a slight increase of 1 Miohl, but remained similar to relatively low levels recorded in 2001, 2003 and 2007.

Almost all the large players have kept their ranking in 2008: Italy remained the world's largest wine exporter by volume, and France kept the title of biggest wine exporter in terms of value, the international wine group said.

The group of six new exporter countries (Southern Hemisphere and the United States) has also continued to grow. The combined market share of Australia and New Zealand, however, fell - from 10 per cent to 9 per cent.

Argentina, Chile, South Africa, Australia, New Zealand and the US saw their collective share of global wine exports rise to 30 per cent last year, up from an average of 23 per cent from 2001 to 2005. 

In a separate report, the San Francisco-based Wine Institute said Americans drank more California wine in 2008 but opted for more-affordable bottles than in 2007. US sales of California wine totalled 467 million gallons last year, up 2 per cent, but the retail value of the sales fell slightly.

Although their overall consumption declined, foreigners bought more American wine. US wine exports 90 per cent of which are from California - rose 8 per cent to 130 million gallons last year, topping the $1-billion sales mark for the first time.


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Broke Europe finds wine losing its flavour