Allegrini 2024

European wines: Consumption and production will decrease between now and 2035, and export growth will slow down as well

The EU Agriculture Commission’s “Agricultural Outlook 2023-2035” forecast is not very positive for the sector
European wines: all parameters on a decline until 2035 (photo: Wirestok on Freepik)

Consumption of wine has been on a decline for years in Europe, especially of red wines. Younger people are on the market but are not drinking wines at the same volume levels as the older generations, which, however, will obviously continue to leave the market. This has been the recurring scenario over the past few decades, and will continue in the future, as consumption is expected to decrease 1% per year between now and 2035, when, at the European Union level, it will be 20 liters per capita, 2.4 less than the 2018-2022 average. We have been talking about this trend for some time now, while the EU Agricultural Outlook 2023-2035, by the Agriculture Commission of the European Union actually published the written report on December 7th. The report has pointed out that “the greater decline in demand for some types of wine will be compensated by growth in demand for non-alcoholic wines, low alcohol content wines, whites, rosés and sparkling wines”. The decline in wine consumption, according to the European Union, will lead to a generally reduced domestic consumption by 2035, while “other uses” might remain relatively stable at 30.000 hectoliters (for instance, distillation or processed products). This trend could even be considered rather optimistic, and instead there could be a greater risk of decrease in the future. In any case, not only consumption will decrease. The drop in demand has consequently caused a decrease in European wine production, which will also decrease -0.6% per year, to reach, net of the various vintages performances, 145 million hectoliters by 2035. “Although the European Union wine sector has been struggling with difficult or even extreme climate phenomena for several years, production has continued to adapt to these challenges. Nevertheless, expected reduction in pesticide use, and plans for further irrigation restrictions in some European Union Countries could reduce both yields as well as the area dedicated to wine production”, the European Union Agriculture Commission explained. The Commission also predicted a slowdown in export growth, emphasizing that some "traditional" markets are now at saturation levels. “Therefore, the growth rate of European Union wine exports might be rather limited over the next few years (only 0.3% per year between now and 2035). The slowdown in export volumes could be attributed to increased competition in the basic and mid-level (low- and medium-priced) wine sector as well as changing consumption patterns in the European Union main export markets. The European Union could continue, though, to benefit from exports of higher quality PDO and PGI wines and sparkling wines, which could support the value growth of European Union wine exports”.

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