Liquid Geography: The Geography of Vine and Wine David R. Green

Lecture 4

Wine Regions of the World

Lecture 4 Nomenclature of Territorial Units for Statistics(NUTS)

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Lecture 4 Economic Geography! Wine Production, Wine Consumption, and Wine Trade (Export and Import) Annual production of wine in the 1970s exceeded 300m microlitres (see Table 3) Achieved on cultivated area of 11m hectares (27m acres) Approximately 0.75% of total cultivated land in the World Year to year variation of figures......

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Many factors e.g. Changing weather conditions France alone - even in a bad year - produces more wine than all the vineyards of North & South America, South Africa and Australia combined France and Italy together produce 45% of the total Spain is third (20-40m hectolitres) Argentina and Soviet Union - each around 30m hectolitres Table 4 (from de Blij) shows trends over

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In some countries land under viticulture is increasing Historical ups and downs - > declines (as previously discussed) From Table 4 also e.g. Australia’s production from a local point of view is high when consider the small domestic market and the distances to external markets

Lecture 4 Wine production is of course dependent on the grapes - which in turn are dependent on the weather conditions Makes it hard to predict wine production each year Instead one can use the overall expansion of vineyards as a better indicator And in general - in the recent past - land under grapevines has continued to expand in many (although not all countries)

Lecture 4 Spatial pattern of wine consumption has changed over time Traditionally the largest producers have been the largest per capita consumers But wine consumption per person has fluctuated even in traditional markets In some it has declined - in others it has risen But not always easy to determine from the data and should therefore be seen as an approximation of trends

Lecture 4 Table 5 (from de Blij) Data should be seen in the context of the ranking of countries’ total populations Continued rise in World consumption (1) Population increase over the past two decades compensates for a decline in per capita consumption (2) Increasing consumption of wine in countries with large or substantial populations e.g. USA, Soviet Union, West Germany, Spain and even Argentina In some countries wine consumption has been actively encouraged (versus ‘hard’ liquor) Helped e.g. in Soviet Union by increased production at home and links with other countries for import e.g. Argentina

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Other factors that reflect in wine consumption are: –Price (e.g. in many countries wine is perceived to be a luxury item) –Cultural preferences (e.g. Japan) –Public awareness (e.g. in USA) –In other countries e.g. Netherlands, Denmark, Finland, Ireland, Belgium, Norway and Sweden a very large increase in wine consumption since the 1960s (after years of limited consumption)

Lecture 4 A lot of wine is traded - local, national and also international markets International wine trade from year to year reflects: –Demand for wine not locally produced –Demand for low-priced wines in some markets –Demand for high-priced wines in some markets –Demand for wines in countries that do not produce wine (or in any quantity) –Year to year variations in harvest in different viticultural regions

Lecture 4 Table 6 (from de Blij)- shows imports and exports Notice that UK was not a wind producer at the time Table 6 was produced Imported most of its wines Although wine consumption per capita is low the comparatively low level of consumption creates a substantial demand in lieu of the market size Makes UK one of the largest wine importers (at this time 4 th largest) Compare article from newspapers today Good years in wine producing regions is reflected in the ‘flow of wine on the international markets’

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Major movements of wine tend to mask the smaller ones For example, Californian wines largely sold and consumed locally - but this has changed Wines from Chile and Argentina also finding new markets Many other countries have increased their exports to international markets In general, despite ups and downs, international wine trade has generally increased significantly in past years

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World Wine Statistics 2010

Lecture 4 World vineyard acreage in 2010 Global vineyard surface area shrunk in 2010 to 7.6 million hectares, losing around 10,000 ha. The “old world” is still very dominant although the “New World have increased in importance, gaining just over nine percentage points over the period. Europe: 57% Asia: 22% Americas: 13% Africa: 5% Oceania: 2.7% (e.g. Australia, New Zealand etc..)

Lecture 4 The world wide vineyard acreage has been steadily declining since 2003 when it peaked at almost 7.9M ha. The big “losers” are the traditional big, old world wine countries: Spain, France, and Italy. The 12 leading countries are: Spain: 1082 Mha France: 825 kha Italy: 798 kha Turkey: 505 kha China: 490 kha USA: 404 kha Iran: 300 kha Portugal: 243 kha Argentina: 228 kha Romania: 204 kha Chile: 200 kha Australia: 170 kha

Lecture 4 World wine production 2010 Just like vineyard acreage, world wine production shrunk in The total volume of wine produced in 2010 is estimated to be 263 million hectolitre down slightly from 270 Mhl in Europe: 66% Amercias: 19% Asia: 5.5% Oceania: 5% Africa: 4% The New World has gained 7% points on the old world over fifteen years. World wine production peaked in 2004 at just under 300 Mhl.

Lecture 4 The 12 leading wine producing countries in 2010 were: Italy: 48.6 Mhl France: 45.3 Mhl Spain: 36.1 Mhl USA: 19.6 Mhl Argentina: 16.3 Mhl China: 13 Mhl Australia: 11.2 Mhl South Africa: 9.2 Mhl Chile: 8.8 Mhl Russia: 8.2 Mhl Germany: 7.2 Mhl Portugal: 6.8 Mhl

Lecture 4 Global wine consumption 2010 In contrast to global vineyard area and wine production, that declined, global wine consumption saw a slight increase in 2010, inching marginally up to 238 million hectolitres. World consumption peaked in 2007 at around 250 Mhl, declined substantially in 2008 and But this decline was stopped in 2010 when the consumption essentially levelled out. The Old World is by far the biggest consumer, accounting for 65% of the total, but its importance have declined (7 percentage points over 15 years): Europe: 65% Americas: 22% Asia: 7.9% Africa: 2.9% Oceania: 2.7%

Lecture 4 There are dramatic differences in consumer patterns in different parts of the world: The traditional big producers and consumers have declining consumption: France, Italy and Spain have seen the consumption drop radically. The big growth markets are the USA, China, Australia, Russia and (curiously) the UK (in the longer term). The US passed Italy in 2006 (both countries drank 27 Mhl that year) and looks likely to overtake France as the biggest consumer if the trends continue.

Lecture 4 Country wine consumption 2010 The top twelve countries: France: 29.4 Mhl (trend: -) USA: 27.1 Mhl (+) Italy: 24.5 Mhl (-) Germany 20.2 Mhl (+) China: 14.3 Mhl (+) UK: 13.2 Mhl (=/+) Spain: 10.9 Mhl (-) Argentina: 10 Mhl (-) Russia: 9.7 Mhl (short term -, longer +) Australia: 5.3 Mhl (+) Portugal: 4.4 Mhl (-) Canada: 4.4 Mhl (+)

Lecture 4 World wine export numbers (international trade in wine) where there is a real boom. Wine is more and more consumed outside the country of production. There are two big drivers behind this: the big producers are consuming less wine domestically and thus have to export more. Secondly, there is a host of “new” wine producing countries that are becoming important wine producers but that have relatively modest local demand. Looking back over the period 2002 to 2010: Italy: has seen a steady growth, especially lately and is now the biggest exporter. Spain: has also seen a substantial increase in exports (>+50%) over the period and has become the second exporter. France: Used to be the biggest exporter but has seen a steady, but not dramatic, decline (-12% over the period) and has fallen to 3rd place. After these there is a big group of countries that have seen very impressive growth in wine exports: Australia, Chile, USA, South Africa, Argentina, New Zealand and curiously even Germany. The big loser in relative terms, in market share, is France, although in absolute numbers it has not shrunk all that much.

Lecture 4 World wine exports 2010 The top twelve countries: Italy: 20.6 Mhl (trend: +) Spain: 17.1 Mhl (+) France: 13.5 Mhl (-) Australia:7.8 Mhl (+) Chile: 7.3 Mhl (+) USA: 4.1 Mhl (+) South Africa: 3.9 Mhl (+) Germany: 3.8 Mhl (+) Argentina: 2.7 Mhl (+) Portugal: 2.6 Mhl (-) New Zealand: 1.4 Mhl (+) Moldavia (!): 1 Mhl (-)

Lecture 4 The top 14 countries: Germany: 14.2 Mhl (trend ‘05-‘10: +) UK: 12.5 Mhl (+) USA: 9.3 Mhl (+) Russia: 5.5 Mhl (-) France: 4.5 Mhl (-) Canada: 3.5 Mhl (+) Netherlands: 3.3 Mhl (-) Belgium: 3 Mhl (+) China: 2.9 Mhl (+) Japan: 2 Mhl (+) Denmark: 2 Mhl (+) Switzerland: 1.9 Mhl (+) Italy: 1.7 Mhl (-) Portugal: 1.6 Mhl (+)

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Wine imports 2010 Since wine exports are booming so is wine import. Over the period 1995 to 2010 it has increased from 48 million hl to almost the double: 87 Mhl. The wine buyers have been even more dominantly Old World: today 70% of wine imports are to European countries (including intra-Europe), down though from 83% in It is perhaps surprising to find Germany at the top of the list, but it has been there for quite some time. The big gains have been in the USA, Canada, and China. China is still (in 2010) modest in size, only in 9th position, but in percentage terms the growth has been very high, from almost nothing in If the trend continues (as many producers hope) it will rapidly climb up the chart.

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