Imported Wine Category Shows Growth After Three-Year SlumpMay 10, 2012
The U.S. market’s imported still wine category grew in 2011 for the first time in three years, due to strong growth from Old World and New World producers. Key factors contributing to the rebound include growing interest overseas in the long-term growth potential of the U.S. wine market, the willingness of younger adults to experiment with new varietals and a reduction in the California winegrape crush. Total (bottled and bulk) imported wine volume in the U.S. increased 7.3% to approximately 98.6 million cases in 2011, according to Impact Databank. The volume of imported bottled still wine advanced 2.7% to approximately 75.3 million cases, while imported bulk still wine surged 25.1% to the equivalent of approximately 23.4 million cases.
The California winegrape crush has decreased for the last two consecutive years. The 9% decrease in 2011 to 3.3 million tons came on the heels of a 3% decline in 2010. David Kent, CEO, The Wine Group, notes that California wine grape plantings have failed to keep pace with the growth of domestic consumption. “It’s increasingly clear that California’s share of the U.S. wine market will fall below 50% by the end of this decade,” he says. “Millennial consumers have a much greater interest in trying lesser-known varietal wines, such as Malbec, which haven’t been planted on a large scale in the U.S.”
With 13.3% growth overall last year to 28 million cases, Italy is firmly entrenched as the imported wine leader in the U.S. Bottled Italian wine imports rose by 11.5% in 2011, to more than 27 million cases (nearly 97% of Italian wine imports are bottled). “The recession has hurt everyone. We’ve had to be proactive,” says Leonardo Frescobaldi, president of Tuscany-based Frescobaldi. “American consumers are now more aware of the concept of value. People are ready to spend, provided the brand is prestigious.”
Kent anticipates that imported wine growth will strengthen throughout the decade. “The two key factors driving current import demand—the relative shortage of California wine and the tendency to explore by millennial consumers—will not likely change in the near-term. And if the U.S. dollar grows stronger, the import party will likely kick into high gear,” he says.
Tagged : wine