Allegrini 2024

Wine, spirits and vinegar supply chain in Italy is worth 21.5 billion euros, and looks to the future

The numbers and the many challenges of an industry that continues to invest and create widespread wealth in the Nomisma survey by Federvini
Wine, spirits and vinegars in Italy are worth 21.5 billion euros (ph: Depositphotos)

Over 2,340 enterprises (38,000 considering also agricultural processing ones), 21.5 billion euros of direct turnover, 10 billion euros of exports (80% of which are concentrated between Europe and North America, and with a surplus of more than 8 billion), 1 billion euros brought to the Treasury’s coffers (73% coming from excise duties on intermediate products, 26% from corporate income taxes and 1% from state marks), to which is added a consumption VAT for wine, spirits and vinegars of 3.2 billion euros: these are the most important values that emerge from the “Supply Chain Study”, for the Wines, Spirits and Vinegars sectors, carried out by Nomisma for Federvini and presented today at the Chamber of Deputies, in Rome. Equally relevant are the values in terms of employment: against 81,400 workers directly employed by companies in the three sectors, thanks to a multiplier effect equal to 5.8, more than 460,000 are activated in the entire national economic system, which corresponds to almost 2% of the total number of workers in Italy.
“This study highlights the extraordinary dimension achieved, on the whole, by the supply chains we represent, which assume strategic importance for the Italian economic system with an added value of more than 20 billion euros per year and an export that moves 10 billion euros. Industries deserving of the highest consideration and the most attentive institutional support, made up of companies committed every day to enhancing quality products, the result of the work and dedication of healthy and dynamic businesses”, commented Micaela Pallini, president of Federvini. “The producers of wines, spirits and vinegars express a heritage of culture, history, economy and work that produces well-being for local communities and that, by investing in innovation, sustainability and research, contributes to the growth of our country and to the fact that the Italian lifestyle is so appreciated in the world. Businesses that are still highly exposed to geopolitical, regulatory, commercial, and inflationary uncertainties. Just think of the recent problems in the Red Sea, which have already caused the cost of maritime freight rates to rise sharply again. The defense of this made-in-Italy heritage, with its history, culture and reputation, is as much the responsibility of entrepreneurs, with their representative organizations, as of institutions. Yesterday we were received by Pope Francis; he told us that wine, land and agricultural skills are gifts that God has entrusted to people to bring joy to all. He spoke of care for the environment, healthy consumption habits, respect: values that reflect the way we are companies in this sector”.
The photograph highlights the strategic importance that the "Federvini supply chains" play for the "Country System" in economic terms. In fact, the three sectors generate on the national territory an added value, including indirect and induced components, equal to 20.5 billion euros, corresponding to 1.5% of the national GDP. Of this, 4.9 billion can be attributed to the direct effect (attributable to the businesses in the sectors through their own production activities), 9 billion can be attributed to the indirect effect (produced by the various suppliers activated and the demand generated in turn by the suppliers, of which 26% is attributable to agriculture, sector that benefits the most, then come consulting and services, at 16%, and transport and logistics, 12%) and 6.6 billion to the induced effect, i.e., that generated by the increase in income received by all those involved in various ways in the economic process (of which 25% real estate activities and 17% between retail and Horeca). Still, in terms of exports, the research explains, the Italian wine, spirits and vinegars sectors hold a very important position, not only in terms of their incidence on food & beverage cross-border sales (19%), but especially for their positive contribution to the agri-food trade balance: 8.4 billion euros of net aggregate trade balance, the highest contribution among Italian food & beverage products. Our country is now the world’s leading exporter by value of vinegars, with a 37% share of global exports, as well as of vermouths (34%), the second of bottled still wines (22%, compared to 29% in France), and of sparkling wines (25%, compared to 52% in France) and liqueurs (14%). Overall, Italy has experienced value growth in foreign markets of more than 76% over the past decade.
“Thanks to their production activities and supplies of raw materials and services - often locally sourced - enterprises in the “Federvini supply chains” play a very important economic role for our country, activating value in multiple economic sectors, from agriculture to logistics, via retail to horeca and real estate. Every euro of added value directly generated by companies in the wines, spirits and vinegars sectors creates as much as 4.2 euros in the entire national economy thanks to the indirect and induced impacts on other made-in-Italy supply chains”, said Emanuele Di Faustino, head of Industry Retail and Services at Nomisma. “The continuity of the strategic contribution that the “Federvini supply chains” provide to the country system is, however, put to the test by the challenges related to the uncertain international macroeconomic and geopolitical scenario. Just think of the recent Red Sea crisis or the anti-dumping investigation on European distillates by China, aspects that could also have an important impact on Italian exports. There is not only this: think also of the demographic crisis. Italy, for example, is aging”, Di Faustino stressed, “fast: in 2050 there will be 5 million fewer people and the over-65s will go from 28% to 42% of the population, with young people, moreover, having totally different consumption patterns than past generations. But there are also many positive aspects. Perceived quality is high, areas of the world such as the Middle East, Africa and Latin America, which are marginal today, can grow so much, and in addition, growing tourism is a lever to be activated, as is the growth of investment in environmental and social sustainability”.
Also speaking about challenges for the sector, in connection from Brussels, MEP Paolo De Castro: “challenges that never end, we are in the midst of a battle. We focused in the bilateral with Agriculture Commissioner Janusz Wojciechowski on the issue of labeling, which has worried businesses. The Commissioner undertook to clarify that compliance with the Wine CMO does not oblige anyone to go beyond what is already provided for. When we brought home the result of the CMO in the Pac, the will was clear: not to create difficulties for producers with the translation of all ingredients in all EU languages, calories and Qr Code on the label are enough. If the Commissioner, as he has pledged to do, clarifies this with a statement of his own, it will be an important step. But there are the ever-present health pressures, for example”, De Castro said, “ideas of labeling that evoke health scares, as Ireland has done, and we hope it will not be a precedent for others, because in Northern European countries the approach is different from the Mediterranean. In short, the challenges are many. The Commission’s term is coming to an end soon, the Parliament goes to a vote in June, and it’s important to understand that, in the coming months, we're going to stake everything on it, and it will be crucial to have an Agriculture Commissioner who can balance the health and environmental pressures that are so strong in Europe, and so far that has not been the case. And that is also one of the reasons for the protests we see all over Europe, there is a deep malaise because farmers have the perception of a European Commission that is the enemy of Agriculture. There are no specific measures that are worrying, but a general feeling that is worrying and that we have to take into account”.
“Having the possibility that these chains of wine, spirits and vinegars are perceived by institutions for what they are, beyond their intangible value is important. The cornerstone of our reasoning at Federvini, for decades”, said vice president Piero Mastroberardino, a wine producer in Campania, Italy, “is the recovery of value, without losing awareness of the quantitative aspect, which also has an important social value, because they are supply chains innervated in the country system, vital for local communities, which matter so much. But the turbulence in agriculture in Europe, even with violent acts by some elements of the wine supply chain in France, should give us pause for thought. Global competition is getting stronger, even emerging markets are now mature, the supply of wine now comes from all over the world. But there is an issue that is the time of return on investment: today the world reasons in 3 months, in finance, wine reasons in 20-30 years. And when finance, for example, a fund, comes into a company, it asks to split the agricultural and commercial assets. But it’s a contradiction to what we tell ourselves, that value recovery should be done in the agricultural part first and foremost. Federvini has always asked institutions to free up resources, which is the only way to be competitive. Eliminate redundancies, remove things that are not needed or that we redo the same over and over again, even at the bureaucratic level. Then there is the issue of promotion: let’s help ourselves regain competitiveness without hurting ourselves, let's use rules at least on par with other European countries. And again, the issue of branding, which, for our companies, at 95 percent is linked to the family and familiarity of the company. But one thing is fundamental: to bring the diversity of territories into common factor, because if we wage a price war at home, we won’t get out of it, especially now that we have realized that the drop in consumption is a structural issue. We need to unite around leaders who create value, use their boost effect, not the other way around”. In any case, despite a thousand difficulties, companies in the supply chain continue to invest in sustainability across the board, environmental, social and economic. “More than 90% of the companies in the three sectors surveyed have made investments in the past three years, not only for the purchase of capital goods, but also in support of environmental sustainability (sustainable packaging, reduction of water consumption, production of renewable energy) and social sustainability (cultural activities, selection of local suppliers, humanitarian initiatives), staff training, and research and development for new products. This active role towards sustainability is confirmed by 85% of the Italian population who believe that wine, spirits and vinegar companies contribute positively to the economic development of the territories in which they are established as well as to the strengthening of the Made in Italy image abroad. A reputation that, for 7 out of 10 Italians, also derives from the positive contribution made by vineyards in protecting the Italian landscape, safeguarding rural areas by preventing soil erosion, and encouraging tourism”, stressed Denis Pantini, Nomisma Wine Monitor agribusiness manager.
Numbers and reflections that tell of an industry that looks to the future, without forgetting its past and those who helped it become great and important, such as Cavalier Ezio Rivella, among the fathers of modern oenology and a pioneer who, with Castello Banfi in Montalcino above all, but not only, brought Italian wine from first to the U.S., and then to the world, and remembered in closing by Federvini president Micaela Pallini, who called him a “master of value”. Whose lessons, even today, are more relevant than ever.

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