Wine Quarterly Q4 2017
Declining global production and rising prices are likely to affect supply and consumption, in particular at the lower end of the market. This may benefit beer producers and perhaps also encourage premiumisation in developed markets. But lower volumes and higher input costs will also affect revenues and margins, putting a number of industry players under pressure, particularly in Europe.
For the latest wine quarterlies, please go to Wine Quarterly
Download the full report
Rising bulk prices
With this year’s production decimated by frost, heat, drought, and hail, bulk prices for Italian and Spanish wines have been rising significantly since May. This follows increasing prices for Chilean and Argentine wines earlier in the year, and French wines are likely to follow. As a result, shifts in demand will be inevitable.
M&A to remain dynamic
Industry consolidation continued during the summer, based predominantly in local deals. At the same time, private investors remained attracted to the industry, particularly in Europe. There is still money available and the adverse harvest may eventually result in some investment opportunities.
US imports still rising
US wine imports continue to rise, with value growth (6%) outpacing volume growth (3%). France and New Zealand maintained their strong momentum both in volume and value. For Australian wines, there has been a clear shift from bottled to bulk wines, bringing down the average price per litre.
Where to go from here
Wine Quarterly Q4 2020: What the Wine Industry Can Learn From Concha y Toro (and Constellation Brands)
Wine Quarterly Q3 2020: Covid-19 and the US Premium Wine Market, Part II: Building an E-Commerce Team 101
Wine Quarterly Q2 2020: Covid-19 and the US Premium Wine Market, Part I: The Challenges
Wine Quarterly Q1: Can the US Wine Market Regain Its Momentum?