18th January 2018 |
Spain is a large and efficient wine producer, very competitive in price and quality. The Spanish wine industry, as it happens in other important wine producing countries, is polarised between a few large-scale producers and exporters and a large number of medium to very small producers, some of which are barely visible in international markets while offering very interesting, quality wines at very reasonable prices. In brief, Spain can offer an optimum value option for:
In which case is then Spanish wine not too likely to provide an ideal match to your needs? Premium, luxury or collector wines are not Spain’s forte. For historical, social and economic reasons, Spanish wine has kept close to peasants and agriculture, played in the past a roll in the carbohydrates intake of a majority and developed as quality produce in the context of Spanish traditional and modern food and cuisine culture.
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With nearly one million hectares of vineyards, Spain ranks number one in the world as the country with most farmland planted with vines, including upcoming China that has grown wine production rapidly in the last few years.
Out of the 7.5 million hectares of vineyards registered in the world in 2016, Spain accounts for the largest share with 13 percent or 975,000ha.
Spain produced in 2016 nearly 4,000 million litres out of the total 26,700 million produced in the world and ranked number three behind France and the world´s leader, Italy. There are a number of reasons behind the fact that the largest vineyard does not translate into the largest production volume. These include limited rainfall in most areas, types of soil and viticulture -mainly traditional, with only a small fraction fitted with some irrigation system-, varieties planted and average age of the vines. One may argue that the mostly produced wine making variety in Spain -and interestingly, in the world-, white airen, is offers naturally high fruit yields. However, yields of other varieties and the rest of contributing factors outweigh this circumstance.
Out of over 10,000 Million litres of wine exported in the world in 2016, Spain exported 2,236 Million, more than any other country. In terms of value, Spain ranked third behind Italy and longer behind France. This translates logically into a very competitive average export price that is a mere 42 percent of the world’s equivalent. Consequently in almost every market segment there are quality Spanish wines of exceptional value for money.
In the UK Spain occupies a third position on the list of wine suppliers both in terms of volume (with Italy at the top followed by France) and value (led by France followed by Italy). Spain presents the lowest average price amongst the UK’s five main wine suppliers.
In 2017 there were 4,093 registered wineries in Spain, with only an exceptional hundred not engaged in exporting. Up to 56 percent of them have 2 employees or less and 83 percent have 9 employees or less. In brief, the vast majority of Spanish wineries are small or tiny. On the other extreme, as few as the four largest companies account for a 20 percent share of the Spanish domestic market.
International consumers are much more likely to find large-scale production Spanish wine than small producers’ artisan wine. In 2016 only 102 wineries (2.6% of the total) exported more tan €5 Mill per winery to an accumulated turnover equivalent to the 69.7% of all Spanish wine exports (€2,714.5 Mill in 2016). On the other hand, the 2,551 smaller exporting wineries (64% of them) hardly accounted for 1 percent of the value of Spanish wine exports.
On the 4th July 2017 at an ICEX conference on internationalisation of Spanish wines, well known Spanish wine analyst Sara Jane Evans, MW mentioned some significant data: in 2017 the presence of Spanish wine in the fine wine market has been erratic and hardly grown over the last few years to a mere 0.7 percent in value or 1.16 percent in volume of total trade. She mentioned a number of problems for this presence to be this little significant: (*)
In order to eventually rectify these problems Ms Evans proposed a list of actions that could help such as the appointment of “ambassadors”, creating a link between fine wines and the people behind them for a perception of authenticity and mainly the promotion of regional events and active participation at international ones.
(*) The ideas here reflected derive from personal notes of this author and presentation slides from the conference. Possible inaccuracies or misrepresentations are only attributable and responsibility of this author.
Text, charts and graphics by Manuel Sevilla, Bodega Soul