Spain has tripled her wine exports in both value and volume over the last two decades and the performance of recent years has been particularly strong, partly due to the need to look beyond the home market when Spain’s economy nosedived. The huge 2013 harvest also meant that Spain could sell record amounts of wine – even to France and Italy. The 2014 harvest yielded a more typical size (and 2015 is expected to follow suit), hopefully signalling the start of better prices.
At a glance
In the year to March 2015, Spain was the largest exporter of wine by volume of the major wine producers. The country exported 2,321m L, exceeding Italy and France. In terms of value, however, Spain earned just €2.5bn ($2.7bn) compared to France’s €7.8bn and Italy’s €5.2bn, according to the OEMV. Since 2000, France and Italy have increased the value of their exports; Italy has reduced bulk wine sales from 48.7% in 2000 to around 27% currently. The country is no longer a major supplier of bulk wine to France, and Italian producers have succeeded in developing higher quality wines, with the notable success of sparkling.
Meanwhile Spain has filled Italy’s shoes in selling significant amounts of bulk wine to France, with Spain’s exports of bulk wine and lower priced wines (containers of 2L+) accounting for 47% of exports in the year to March 2015. The average price for exported wine has fallen since 2000 from €1.41/L to €1.02/L, a level far lower than her competitors. Furthermore Spain’s average price is low across all wine categories: must, bulk and bottled wines.
Looking at progress since 2007/08, when the Spanish economic crisis started, exports have grown steadily as producers increased their efforts to sell abroad. Bulk wine remains a significant part of the business, accounting for €468m of the total €2.5bn in 2014. The remainder is split between DO wines, non-DO bottled wines and Cava, with non-DO bottled wines having emerged as a new and significant category.
Rafael del Rey, managing director of consultants OEMV, believes that Spain is now firmly established in export. He says: “Companies have a better knowledge of markets and a better relationship with importers.” OEMV figures show that the regions showing the strongest growth in the period 2000 to 2015 are Castilla-La Mancha, Catalonia and La Rioja.
Export growth for the first eight months of the year is encouraging, with increases of 13% by volume and 5% by value. The Spanish economy is also gradually emerging from the extremely bleak period from 2007, with confidence returning to both the trade and the consumer and a greater willingness to spend money once again. The situation could be even better after the presidential elections scheduled for December, which should bring political stability.
New campaigns
Generic activity has been stepped up in a number of key markets. Indeed in one interesting example two DOs – Rueda and Ribera del Duero – have joined forces to promote their wines. Both DO regions are part of the Castilla y León autonomous community and are arguably ideal bedfellows, with Rueda being one of Spain’s major white wine regions and Ribera del Duero championing red Tempranillo wines.
The campaign began in the US earlier this year and was extended to the UK this autumn. The marketing push for the UK - the Two R’s Roadshow – involves more than 40 wineries from each DO showing their wines at trade and consumer events in Edinburgh, Dublin and Manchester.
Rueda’s generic spend increases annually as its export business expands, according to Arancha Zamácola Feijoo at the region’s Consejo Regulador. This year, Rueda undertook promotional activity in Canada, Peru, Colombia, Chile and Australia, as well as in established markets such as Germany, Switzerland and Holland. Rueda and Ribera del Duero each invested €1.5m to get their joint campaign off the ground for 2014/15.
Rioja’s annual spend is around €9m, according to Ricardo Aguiriano, marketing director at the region’s Consejo. He says: “In the last couple of years we have extended marketing campaigns beyond our core markets to Canada, Russia and Ireland, as we see these as important areas for growth and investment.”
The focus of Rioja’s campaigns centres on gastronomy and closely associates Rioja wines with tapas. In the UK, the Tapas Fantásticas consumer event has been staged for seven years in London and this year it took to the road with events in other cities across the UK and Ireland. Cava’s Consejo Regulador is also currently running promotional campaigns in two of its key markets. The Cava London Experience is running in the UK and similar events have been held in Germany.
