Examples Chapter 1 Flashcards
Give example of uncommon increase in volume of wine in terms of a vintage.
in 2013, uncommonly high spring and summer rainfall in the usually arid Castilla-La Mancha increased the volume of wine produced in Spain to 45.3 million hectolitres.
Give example of uncommon decrease in volume of wine in terms of a vintage.
in 2017 spring frosts in much of Europe produced the lowest global volume production for 50 years. In comparison, Spain’s production in this year was 32.5 million hectolitres.
Example of specific style of wine increase in last decade.
Sparkling wine consumption increased by an average of 3 per cent annually between 2002 and 2018.
Top 5 wine consumption countries in order?
- USA
- France
- Italy
- Germany
- China
When USA overtook France and Italy to become largest consuming country in the world?
2011
Reasons behind China’s increased wine consumption?
Growing midle class; aspire to drink primarily French but increasingly also Australia, China.
Example of fashionable drink in younger generation for a specific market?
Gin in Spain
According to Drinks Business, in August 2023 Gallup study shown that how many British consumers aged 18-24 abstain from alcohol?
About 33%
those who do drink tend to do so “primarily as a treat, to relax, or to mark a special occasion”
Which styles and in which countries are increasing in sales significantly?
Rose: USA
Sparkling: USA and UK
According to Drinks Business Prosecco has 2% growth Y2Y in USA
Which sparkling wines increased in exports and which decreased (acc. to Meininger)
According to Meininger:
Italian sparkling wine exports increased in value by 3.3%
French exports decreased by 1.1%; Champagne accounts for 91% of French export value but only 58% of the volume.
Italy leads in sparkling wine exports by volume, while France, despite exporting less, commands higher prices.
Which styles are decreasing in demand?
- Fortified (15 - 22%)
- medium-sweet Getrman wines (ex. liebfraumilch) - popular esp. in 50s - 70s
What is a brand of Liebfraumilch that had to reinvent istelf due to lower demand for medium-sweet wines?
Blue Nun
Examples of leading wine publications which can influence reputation?
Wine Spectator in USA
Jancis Robinson in UK
Example of expensive wine which lost sales after 2008 financial crash due to lower economy strength?
Champagne
cheaper sparkling wines increased
Example where rising economy and increased disposable income driven wine sales for aspirational wines?
China, increasing demand for aspirational wines from Burgundy and Bordeaux
What is the reason behind recent boom in Argentinian wines?
Weak currency from producers’ country which meant that their wines were competitively priced on the global market.
Example of market situation where demand for one product from category increases?
When competitor is out supply is lower, therefore increasing demand.
How can countries control sale of alcohol
state owned monopolies (Swede, Norway, Canada), 3-tier system in USA
How limiting and controling alcohol sales influence prices?
Limits supply, increasing prices.
How can countries control sale of alcohol without state owning monopolies?
minimum legal drinking age
sales limited to particular hours of the day
Example of law encouraging citizens to drink less?
in France, the Loi Evin, introduced in 1991, restricted the advertising of alcoholic drinks and is considered a significant factor in the reduction in wine consumption in France
Example of law reducing availability of cheap alcohol?
Scotland, minimum unit pricing. GBP 0.5 per unit (x ABV x volume in liters).
Limit of alcohol befor a person can drive. Examples:
NZ, Scotland from 80mg/100ml to 50mg/100ml
Norway, Sweden: 20mg/100ml
Excise duties example
Republic of Ireland (per bottle):
Still: 3,19EUR
Sparkling:6,37EUR (reduced demand for sparkling)
Reasons to lower excise duties and example?
to make certain categories more competitive
ex. 2008 Hong Kong who wanted to become trading hub of East Asia
According to Drink Business in 2018 total wine imports $153million (2006 $121milion)
Countries which entered trade deals with EU and which didn’t?
DID: Chile, South Africa
DIDN’T: Australia
Example of trade restrictions and invlyuence on wine imports/production?
Argentina in early 2010s; affected wine imports and imports of winery equipment (barrels, cork, yeast) which increased production costs; also imposed restrictions on foreign ownership of land (slowed down foreign investment)
China/US war
Russia embargo
Wine law which quickly gave significant effects?
China in 2012 Xi Jinping stops lavish gifting (Anti-Extravagance campaign). decreased demand for Grand Crus and increased tor less expensive wines.
2017 world total production vs 2018?
2017: around 250mln hl
2018 just below 300mln hl
Estimates say that % of vineyards are used for wine production?
90%
Example of country with vast majority of vineyards not for wine production?
China
2nd largest vineyard plantings
7-10th largest wine producer
Trend in Area under vine in last 15y?
Until 2011 - dropping
2011 - 2013 - slight increase
2014 - large increase
2014 - 2016 large decrease (below 2011 level)
2017 - onwards - stable
Top 5 countries in area under vine?
- Spain (dropped until 2012 then stable)
- China (increasing until 2016 then stable)
- France (dropped until 2012 then stable, now slight increase)
- Italy (dropped until 2012 then stable, now slight increase)
- USA (overall stable with slight up-down in 2010 - 2016)
Areas where vine pull scheme in 80s was used most?
Southern France, Italy, Spain
several hunder thousand hectares pulled up
Countries whre vine pull schemes have been used?
EU
Australia
NZ
Argentina
Regions converted from vineyards to other uses?
- Elgin - apples (higher financial return)
- USA: almonds, pistachios
- Madeira: property development, also tourist
- Santa Clara Valley (Silicon Valley) - businesses
Vintage variation in Europe example for volume produced.
2017 a combination of devastating spring frosts, hailstorms and severe heat waves resulted in a 14 per cent fall in production in Europe compared to 2016
Climate change threatening regions
South Africa: 2015 - 2019 droughts
California: lack of rainfall reduced water level reserves to almost 0
Chile: by 2050 95% of country vineyard area will have shortages of irrigation water
GIs outisde of Europe and main difference?
AVAs in USA
Wines of Origin in SA
GIs in Australia
difference: not as strict as in EU
Example for reducing risk of downward price pressure due to GIs introduced?
if customers want to buy a Sauvignon Blanc at an inexpensive price, retailer can select Sauvignon Blanc from around the world and switch country of origin from one year to the next to gain the cheapest price.
if customers want Marlborough Sauvignon Blanc, retailer has to buy from a small area (in global terms) in New Zealand = producer has more control over the price
Example where high demand pressures to extend permitted production area?
Prosecco DOC
Example of PDOs governing bodies actively limiting amount of wine released and reason?
Comité Champagne
Sherry Consejo Regulador
ensuring the market is not oversupplied and maintaining price levels
Main issue with european PDOs and how it was solved?
Strict rules which make it hard to follow trends = can’t compete with lesser regulated
France introduced vin de pays (base for PGI later) - still 85% from area but more varieties and do not impose rules on viti and vini
Region where PGI is important
South of France
Example of undersupply SItuation in Europe?
2017 with bad harvests across Europe
