The international wine trade faced significant challenges throughout 2023, characterized by a downturn in both volume and value, except for a notable exception in France where prices surged.
As reported by the OeMv Vino (Observatorio Español del Mercado del Vino), global wine trade declined by 2.1% in value year-on-year through September 2023, amounting to EUR 36.5 billion.
This decline was compounded by a 7.2% decrease in exports, dropping below the significant threshold of 10 billion liters to 9.9 billion liters, a level not seen since 2014.
Value vs. Volume Trends
Despite the overall decline in volume, the average price of wine increased by 5.4%, reaching EUR 3.67 per liter globally. This increase in price, except for bulk wines, helped mitigate the losses in terms of overall trade value. From February 2021 to March 2023, the wine trade had consistently shown growth in value, which abruptly halted from April 2023 onwards. The downturn persisted for six consecutive months, with particularly steep declines in August (-12.5%) and September (-17%).
In volume terms, the trade scenario was equally challenging, with only March 2023 showing a positive growth of 2.5%. August and September witnessed declines close to 15%, reflecting a widespread reduction in wine shipments across various categories. Bottled wines, although still the most exported category covering 52% of volume and 67% of total value, also experienced a decline. In contrast, sparkling wines and bag-in-box formats showed increased sales.
Regional Insights
Among the top 11 wine exporting countries, which account for over 85% of global trade, only New Zealand (+9.7%) and Portugal (+0.4%) reported growth in volume year-on-year through September 2023. France, despite a decrease in volume (-8.4%), maintained its position among the top exporters by increasing prices significantly, thereby maintaining its lead in export value at EUR 12.1 billion (+0.7%). Italy, the largest exporter by volume with 2.1 billion liters, experienced a slight decrease (-1.3%), consolidating its global leadership in quantity.
The French wine industry's ability to command higher prices contrasted sharply with declines in other major exporting nations like Italy, Spain, Chile, Argentina, and the United States, all of which reported significant decreases in export value. Notably, Chile (-22%), Argentina (-18.9%), and the United States (-18.8%) faced substantial export declines both in volume and value terms.
Conclusion
The global wine trade in 2023 paints a complex picture of resilience and challenges. While some countries managed to navigate the downturn with innovative approaches and modest growth in volume, others struggled against both economic factors and changing consumer preferences. France's success in maintaining export value through price increases underscores its unique position in the global wine market, highlighting the importance of premiumization and brand value in times of economic uncertainty.
Looking forward, the industry will likely continue to face pressures from evolving market dynamics, climate change impacts on production, and shifting consumer behaviors. Adaptation to these challenges through sustainable practices, innovation in marketing and distribution, and strategic pricing strategies will be crucial for wine-producing nations to regain momentum and resilience in the global marketplace.
Source: WineNews, Vinetur