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2021: Historic high in trade and partial recovery in consumption

Speaking from the OIV’s headquarters in Paris, by web conference, director general Pau Roca, presented on 27 April, information on wine production, consumption and international trade in 2021.

2021 saw a partial recovery of global consumption after the 2020 sanitary crisis and the boom in the international trade market, which registered a record high in 2021 in both, volume and value.

However, the scenario for 2022 looks uncertain due to the turbulence posed by the global supply chain crisis, the war in Ukraine, COVID variants and the increasing energy prices.

2021 Key Figures for the wine sector

The surface area of the world vineyard in 2021 is estimated to be 7.3 mha in 2021, only marginally lower compared to 2020.

World wine production, excluding juices and musts, in 2021 is estimated 260 mhl, marking a decrease of almost 3 mhl (-1%), compared to 2020.

World wine consumption in 2021 is estimated at 236 mhl, marking an increase of 2 mhl (+0.7%) compared to 2020 volume.

With a volume of 111.6 mhl, the largest exported volume ever recorded in history, world wine exports in 2021 have increased by 4% compared to 2020, and have boosted even more in terms of value, with 34.3 bn EUR, registering a yearly increase of 16%.

A decline in wine production for 2022 in the Southern Hemisphere is expected overall. This is not necessarily bad news.

This fall recorded is due to the extremely high wine production levels seen in 2021 and this year, we expect harvests to return to their long-term averages.

With the exception of New Zealand and South Africa, all other major Southern Hemisphere wine producing countries are expected to decline their 2022 production levels.

In 2021, the pandemic was certainly not over, but the wine sector overall has proved to be more resilient than other sectors.

Part of this success has to do with the sector’s great capacity to adopt innovative and technological solutions to cope with the lockdown measures like the e-commerce.

The COVID-19 pandemic initially slowed the global supply chain as manufacturers were forced to suspend work until safety precautions were enforced.

New COVID variants and the lack of access to the vaccine, especially in certain developing countries, exacerbated the recovery of global production even when developed economies like US and EU reconciled to their consumption behaviours.

A series of new supply-chain bottlenecks set off by the war in Ukraine as well as a surge in COVID cases in China, which has led to temporary lockdowns in parts of the country.

In addition, the war is putting unprecedented pressure on the global energy market, which was already experiencing a rise in prices in 2021.

Moreover, the sanctions imposed by the EU on Russia are putting further pressure on the market.

Potential trade disruption between EU and Russia might cause some concerns, especially in Italy, France and Spain.

As a reminder, Russia is the 10th largest wine importer in the world in 2021 (accounting for about 2% of the world imports) and the 8th largest wine market in terms of sales value.

The new challenge in 2022 is to see how the sector will cope with this new situation, where global supply chain patterns have to be probably reconsidered and energy prices will create an inflationary pressure on consumers.

 

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