News Analysis: Challenges facing Italy wine exports after record high level

by Eric J. Lyman

ROME, Jan. 4 (Xinhua) -- The taste for wine in the Russian market had an Italian accent in 2017, helping to propel Italy's wine exports to the ever highest levels ever and 7 percent higher than in the previous year.

Italian wine sector analysts told Xinhua that the country must work harder to coordinate and expand efforts to promote Italian viticultural products if it wants to continue the positive trend.

All told, wine exports value totaled 6 billion euros (7.2 billion U.S. dollars) last year, the highest single-year figure on record.

By destination country, Russia was the fastest growing market with a stunning 47 percent increase on year.

By product, the sparking variety saw the fastest growth with 15 percent yearly increase, though it was still dwarfed by French champagne in terms of sales.

Exports to other countries also saw significant gains: to Britain rose by 8 percent, to the U.S. by 6 percent, and to Germany by 3 percent. All the three markets had already been significant for Italian wine producers, meaning gains are generally harder to come by.

Exports to China leapt by a quarter, but were still much lower than exports from France, which remains to be the dominant foreign player in China's wine market.

"I think they take away from this is that the 'Made in Italy' brand when it comes to food and wine products is taking hold as a recognized standard for high quality," said Domenico Bosco, head of the wine division for Coldiretti, the Italian agricultural union that calculated the wine expert figures.

"It's the maturing of the Italian wine market," Bosco said in an interview, adding that for the market to mature further, the Italian government, trade associations, and producers had to work to coordinate promotional efforts more.

Lorenzo Tersi, a consultant on wine and commercial issues, agreed. "Wine promotional efforts not only need to be increased and coordinated across the sector, but also combined with other kinds of promotions, tying it to contemporary art, to fashion, to design, to high-end food, to any area where Italy is recognized as a leader," Tersi told Xinhua.

Bosco said Italy should stress the wine array of native wine grapes in commercial production in Italy, which is far larger than in France or other wine growing countries.

"It's easy for a casual consumer to reach for a familiar wine made from an international varietal like Chardonnay or Cabernet Sauvignon," he said. "But as that consumer looks for new tastes then Italy has to be ready to promote different varietals."

Both Bosco and Tersi predicted Italy would have another strong year for exports this year, but there could be trouble on the horizon after that.

The following year, 2019, will be the first year of release for wines produced in 2017, a year when overall wine production levels was nearly a third below normal due to unusually dry and hot weather. That low production level will be felt over several years, as more high-end and reserve wines from 2017 will be released in 2020, 2021, and beyond.

"The saving grace in terms of the market share for Italian wines may be that other major wine production areas like France and California also had challenging vintages in 2017," Tersi said.

"We just have to hope that the left over production from 2016, which will be released starting this year, and then the early releases from the 2018 vintage will be enough to help fill the demand so that consumers accustomed to Italian wine will still be able to get the wines they want." Enditem