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Wine is joy to the heart, but it is becoming increasingly expensive

29 May 2014 / 14:05:53  GRReporter
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If the memorable phrase "Wine is joy to the heart and comfort to the soul" is true, then fewer hearts in Greece will feel that joy this year, as wine production in the country in the period 2013-2014 was 10% lower than the original forecasts.

A document sent by the Department of Wine Production of the Ministry of Agricultural Development and Food to the European Commission shows that the production volume was 3,343,300 hl (hectolitres), i.e. 9.64% lower than the forecasts made last September.

According to the analysis contained in the macroeconomic studies of the Central Union of Vine and Wine Producing Cooperatives, the reduced quantities of wine produced will lead to price increases in intermediate trade, taking into account the historically low inventory levels of only 1,186,756 hl as of 31 July 2013.

Decline in exports

At the same time, a decline in wine exports was reported in 2013. The preliminary data of the Greek Statistical Office on wine import and export, this year handled again by the Central Union of Vine and Wine Producing Cooperatives, show that the money spent on advertising and promoting Greek wines mainly in markets in third countries (outside the European Union) did not have the intended effect. The reason for this was the reported rapid decline in exports to the European Union as well as the lesser decline in the main export destinations to third countries where about 8 million euro on advertising and promoting Greek wines are spent each year.

According to the data of the Central Union of Vine and Wine Producing Cooperatives, in 2013 wine exports to the internal market of the European Union fell in volume by 36.31% (from 297,611 hl in 2012 to 189,511 hl in 2013). The value of this decline was in the range of 16.23% (from 47,889,419 euro in 2012 to 40,117,296 euro in 2013). Conversely, the exports to third countries reported an increase, both in terms of volume (+16%) and in value (+6.8%).

However, as stated in the message of the Central Union of Vine and Wine Producing Cooperatives, the target markets (U.S. and Canada), where the largest amounts on various advertising and promotional programmes are spent, reported a significant decline in 2013, the most significant being Canada (-19.17% in volume and -22.12% in value in 2012). The reported decline in exports to the U.S. was less (-18.53% in volume and -8.66% in value in 2012).

At the same time, China reported an increase in exports in value (4.33% in 2012) and a decline in volumes (-19.5% in 2012) as well as an increase in the price per litre of wine (from 3.67 euro/l to 4.76 euro/l).

A significant decline in exports to Italy was registered too (by 68.5% in value in 2012), mainly concerning bulk wine, due to the reduced production in two consecutive years (2011 and 2012).

Germany remains a traditional market

Although again with a reported decline (-3.51% in volume), the situation is slightly better in Germany, which is a traditional export market consuming about 50% of Greek exports.

The decline reported in the markets in the UK, Switzerland, Russia, Denmark and Japan is in the range of 15% and 30%. Conversely, an increase in exports was recorded in Sweden and Poland, the champion being Australia, as the exports to it increased in value by 33.72%.
It is expected that after 2015 the European Union will support the promotion of Greek wines on its domestic market through the new common agricultural production, which will also include wine.

Tags: Wine productionExportDeclineCentral Union of Vine and Wine Producing Cooperatives
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