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Global Wine Industry

The global wine industry is expected to generate almost $292 billion in 2014, reports MarketLine. At that point market volume should exceed 22.1 billion liters, representing a near 3.5% increase in five years. Still wine represents the leading market segment, accounting for almost 81% of the global wine market. The EU leads with a 75% share of the global market. Kriter Patriarche is the number one company in the market, exceeding 4% market share in terms of volume.

The world wine market is characterized by intense fragmentation. The world’s three leading winemakers combined hold a little over 8% of the market share in terms of volume. The majority of winemakers own or rent out vineyards, and market accessibility for newcomers is dependant on state regulation concerning wine and other alcoholic beverages markets. These regulations can be quite strict in many regions. The wine market can lose ground to alternatives such as beer and spirits, especially as consumptions trends change. The market is characterized by a moderate degree of competition.

Wineries are involved in the manufacture of wine from the fermented juice of grapes. Most wines have an alcohol content of between 10% and 15%. Wineries may also grow grapes, manufacture brandies and blend wines.

Key Segments

The global champagne market is going through a period of recovery following the economic recession, which took its toll on the industry as consumers cut back on non-essential spending, reports Koncept Analytics. Worldwide shipments of champagne recorded close to 8% growth in 2010. The US, the UK and France constitute the core regional markets in the industry, accounting for over 75% of the overall market in terms of volume in 2010.

France is the world’s largest champagne exporter, but sales fell in 2008 and 2009, especially in the US and the UK, which are France’s two largest export markets. Since the global economy has begun recovering after the economic recession, demand for champagne has buoyed markets. Industry changes include CIVC-headed environmental initiatives such as using biomass wood waste as a renewable energy source and switching to lightweight champagne bottles in an effort to cut down on carbon emissions. Market growth in the champagne industry will be driven by rising wine consumption, higher levels of disposable income and global economic recovery.

Champagne houses have been caught short of stock in light of rapid market recovery, which may prove an obstacle to market growth over the coming years. The champagne market is intensely competitive. Top companies involved in champagne manufacturing include Laurent Perrier, LVMH Moët Hennessy Louis Vuitton, Lanson-BCC and Vranken-Pommery.

Regional Market Share

The US wine market has been recording strong growth over recent years despite the economic recession, reports IbisWorld. Demand has been driven by younger consumers, with many opting for lower-priced wines. Market growth could be slowed by poor harvest conditions, a rising number of state regulations and rising grape prices. The US wine industry accounts for almost 8% of global wine production, and has outpaced France in terms of consumption to become the leading wine consuming region in the world. California leads wine production with 90% market share in terms of volume in 2010. California has more wineries than any other state in the US.

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