The United Kingdom’s wine industry is facing notable turbulence in 2025, as the introduction of a new alcohol taxation system in February coincides with a measurable decline in wine and must imports.
Over the following three months—February, March, and April—both the volume and value of imports dropped, reversing a trend of prior growth. According to a July report by delReyAWM, import volumes fell by 8.5% in February, 6.8% in March, and 8.8% in April, with corresponding value drops of 9.9%, 6.4%, and 7%, respectively.
While some fluctuations can be expected in any market, the alignment of this downturn with the rollout of the new duty structure, which taxes alcoholic beverages based on alcohol content rather than product category, suggests a potential link that merits close attention.
Import Figures Reflect a Market in Adjustment
For the first four months of 2025, the UK imported 354 million liters of wine and must, valued at GBP 1.07 billion (EUR 1.24 billion) — a 5.2% decrease in volume and a 6.3% decline in value compared to the same period in 2024. Despite a modest increase in prices in March and April, the average price per liter actually fell by 1.2%, down to GBP 3.02 (EUR 3.51).
The ongoing reduction in UK wine imports is not entirely new. Since Brexit, annual volumes have dropped from over 14 million hectoliters in 2020 to 12.4 million today. While some recovery was observed in mid-2022 and late 2024, the most recent figures signal a potential long-term trend.
Still Bottled Wines See Steepest Declines
Among the different wine categories:
- Non-sparkling bottled wines took the biggest hit, with volumes falling 4.6% and values down 7.2%. The average price dropped 2.7%, with 171.8 million liters imported at a value of GBP 654.4 million (EUR 759.7 million).
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Sparkling wines remained stable in volume at 40.5 million liters but saw a 7.5% decrease in value due to falling prices (average down to GBP 5.92/liter or EUR 6.87/liter).
- French sparkling wine prices fell 13%
- Italian fell 6.6%
- Spanish Cava prices rose 5%, but volume dropped 17.3% and value by 13.2%
Bulk Wines: Fewer Liters, Steady Revenue
Bulk wine—making up over a third of the UK's wine imports—also declined in volume by 7%, but thanks to a 7.5% price increase, value held steady at GBP 163 million (EUR 189 million). Key observations:
- Chile: volume down 28%
- South Africa: down 26.6%
- Australia: minor increase
- New Zealand: sharp growth in volume, but falling average prices (from GBP 3.39 to GBP 2.88, or EUR 3.94 to EUR 3.34)
Only Australia (+9.1%) and New Zealand (+8.6%) recorded increases in both volume and value in the UK market during this period.
European Producers Bear the Brunt
All major European suppliers saw declines:
- France: -1.7% in volume, -7% in value
- Italy: -1.8% in volume, -8% in value
- Spain: -14.1% in volume, -8.8% in value
In Latin America, Chile was hit hardest with a 24.2% drop in volume and 28.7% in value, while Argentina also declined. South Africa shipped 20% less wine, although improved pricing pushed revenues higher.
New Taxation or Market Correction?
The timing of these declines—with consistent reductions in both volume and value starting the same month the new tax came into force—suggests a potential correlation. The UK’s alcohol-duty overhaul, which shifts taxation from category-based to alcohol-content-based, was anticipated to have repercussions, particularly on mid-tier and higher-strength wines.
Yet, the picture is complex. Ongoing economic uncertainty, inflationary pressures, changing consumer habits, and the aftermath of Brexit all intertwine with this tax change.
For now, it’s too early to attribute the decline solely to taxation. But the current data underline the need to monitor how pricing, sourcing strategies, and consumer behavior evolve in the months ahead.
Conclusion
The UK wine market is undergoing a realignment. The combined impact of regulatory change, international trade pressures, and evolving consumption patterns is reshaping the landscape. As the industry watches closely, producers and importers alike may need to rethink product positioning, sourcing, and pricing strategies in this new era.
Source: Vinetur