Allegrini 2018

Wine exports: in the first half of 2020, Italy grew in the United States and recorded limited damage in Germany

Spanish Wine Market Observatory data revealed June was a tough month in the United States, while it was positive on the German market

Italian wine, as a whole, on its two main foreign markets in volume and value for Italian wineries, has proven to be stronger than Covid-19 in the United States, and quite resilient in Germany. In the United States, negative data in June definitely suggested the worst was yet to come, while on the contrary, there seemed to be a positive trend reversal coming from the German market. That is, at least, looking at the data collected by the Spanish Wine Market Observatory on the first half of this very challenging 2020 of the global pandemic. The United States is one of the countries enduring the most difficulty with the Covid-19 health emergency crisis, and its open market channel is on its knees. However, according to customs data the OEMV (Spanish Wine Market Observatory) processed, Italy has exported wine for 980 million US dollars, marking an increase of +1.8% compared to the first half of 2019, and 177 million liters, up +2.8%.
These data are to be taken in the perspective in which imports overall in the United States decreased -1.2% in volume, to 610 million liters, and 10% in value, to 2.7 billion US dollars, due mainly to the downfall of bottled wine imports, down -13% in value (which are equal to 73.5% of all imports), offset by the growth of bulk wine in containers exceeding 10 liters, which grew 8.9%. At the same time, the main competitor, precisely France, which has been heavily penalized by duties at 25% that impact a large part of French wine imports in the United States, registered -25.5% decrease in value, to 791.5 million US dollars, and -14.1% in quantity, to 81.9 million liters. Next is New Zealand, which grew +11.6% in value, to 266 million euros, and also registered an increase of +7.9% in volume, to 44 million liters. In general, the figure for sparkling wines was conflicting, down -0.7% in value, but up +3.3% in quantity. The general trend, anyway, marks lower-priced wines going to the United States, and indeed the average price per liter has decreased 9%, from 4.9 to 4.5 US dollars per liter. The report underlines, however, that not even Italy should take things too lightly. The overall figure for the first half of the year so far reveals that Italy has held its own, but Italian wine has experienced, like all US imports, a very rough June, (-26% total imports in value).
This is the very complex American situation, but things are certainly no longer easy on the German front, either. In the first six months of 2020, Germany imported wine for 1.14 billion euros, recording a decrease of -7.6%, and a decrease in volume to 668 million liters, less -5.8%, marking negative signs for bottled and bulk wines, as well as for sparkling wines. To date, Italy has passed the point of no return without causing too much damage, since it has been confirmed the number one supplier of foreign wine in volume and value. Italy registered a -1.3% drop in value, to 453.9 million euros, and however remained substantially stable in quantity, at 249.3 million liters (-0.2%). Italy’s performance proved to be much better than its main competitors, because in fact France lost -16.2% in value (to 282.3 million euros) and went down -12.1% in quantity (to 95.1 million liters), while Spain marked a decrease of -9.1% in value (to 162.8 million euros), and less -14% in quantity (163.2 million liters).
It is worth mentioning the big jump of United States wine imports to Germany, which, although starting from low values, registered +11.7% in value, to 40 million euros, and +20.4% in volume, to 22 million liters. Even more interesting is the fact that in June the German market showed a reversal of trend that gives confidence for the second half of the year, since it recorded +1.6% growth in import value compared to the same month in 2019. It is a small number that instead gives a glimmer of optimism to wineries in Italy and around the world, which have been in the midst of grape harvesting in the last few weeks, and this year more than ever, and they will be also very focused on the markets.

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