World wine consumption and trade
CONTENT
- Main wine exporting countries
- What is the influence of tariffs on the wine industry?
- How much has wine gone up? Trends in the rise of trade
- Position of Mexican wines in world trade
There is a rewarding guarantee in the consumption of wine. For hundreds of years this drink has accompanied people in a significant way; high-class events or casual meetings often feature the presence of a wine, usually red wine , which happens to be the most sought after in the world.
Consumption of this beverage is not something that is stuck in the past. In the last twenty years, the international trade and consumption of wine and wine products has shown a considerable increase.
This was revealed by the first edition of the World Forum of Vine and Wine Trade , held in Dijon, France on October 3, 2023. There is a market eager to carry out a wine tasting , demanding to try and consume this drink, so it is quite important to meet this popularity.
That is why, to understand the cultural impact that wine has on society, on this occasion we will talk about the global consumption and trade of wine, as well as the position of Mexican wines in this panorama .
Main wine exporting countries
Looking at the wine trade , we can see that the market has become broader (mainly due to the diversification of consumer tastes). Thus, countries whose economies are traditionally associated with the world of wine , such as France, Italy and Spain, continue to maintain their dominance in wine exports.
However, producers from the New World, such as Australia, Chile and the United States, are taking an important place in the market . It is even possible to find in these international markets, more and more, the presence of Mexican wines , which according to the properties of the region are capable of offering an infinite catalogue of notes for the senses, unlike other countries.
This rise in Mexican wine consumption is reflected in the latest statistics provided by the OIV (International Organisation of Vine and Wine), which ranks Mexico 23rd among wine importing countries.
What is the influence of tariffs on the wine industry?
Among the guidelines that govern fluctuations in international trade are tariffs , a type of tax applied to each import and export product.
However, for international wine trade, tariffs are not a heavy burden compared to the influence of non-tariff measures , i.e. regulations specific to each country that determine factors such as: health and safety considerations, including alcohol warnings.
Statistics on tariffs applied to wine
The MFN (Most Favored Nation) tariff applied to wine is one of the highest in the tariff lists of the members of the World Trade Organization (WTO). Much of this has to do with the fact that it is an alcoholic product.
In 2020, the average applied tariff for MFN was 58%, with a slight decrease in 2022, to 48%. However, when considering imports, the average tariff for non-WTO countries measured by trade in the same year 2022 was 8.8%.
This figure indicates that most wine is imported by non-WTO countries because they have lower tariffs , which greatly influences the commercial pace of this product.
Impact of non-tariff measures on wine trade
There are other trade measures, besides tariffs, that affect wine trade. They are covered by the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS) or by the agreement on technical barriers to trade.
Thanks to such agreements, a government can take measures to protect the health and safety of its inhabitants - we remember that this is about trading in alcoholic beverages - and this is how the labelling or certification of these products is regulated.
Other examples of these measures include inspection protocols, wine sampling and testing methods , geographical designations or the use of traditional terms.
All these measures must be notified to the WTO in order to communicate the implications that these will have on exporters, and to know all the details about the product that will be traded internationally.
How much has wine gone up? Trends in the rise of trade
According to the WTO , international trade in wine products has tripled over the past two decades . Translated into monetary terms, there has been a quite noticeable increase: from 17.7 billion dollars in 2000, it rose to more than 50 billion dollars in 2021 and 2022.
Of these products, wine accounted for the largest share, at 76% in 2022 – the remaining 24% consisted of fresh and dried grapes, as well as grape juice. Over the past twenty years, international trade has thus become a crucial aspect for the wine industry .
The share of imported wine in global consumption has grown from 25% in 2000 to 45% in 2022. This shows that wine consumption has shifted to international markets , with different consumers based in different parts of the world.
Regarding imports, countries such as Germany, the United Kingdom and the United States stand out. It should be noted that, at one time - from 2005 to 2017 - China had a rise in international wine trade, but in recent years its imports have been reduced by more than half.
Position of Mexican wines in world trade
Mexico is ranked 33rd in the world in wine production, which has been sought to maintain its commercialization not only within the national market, but also outside of Mexican territory. To this end, quality programs have been planned, such as the geographical certification of wines that have a positive effect on export values .
Another strategy to promote the presence of Mexican wines on the international scene is the promotion of a collective brand “Vino Mexicano” by the Mexican Wine Council, as part of an initiative to guarantee quality and provide certainty to consumers in other markets.
We have seen that the consumption of Mexican red wines is on the rise, however, this does not mean that it is still free of obstacles; one of them is the taxes that for some bottles can reach around 46.5% additional.
The question of demand must also be considered in this same matter: According to the ICEX export and investment agency , by 2022 only 30% of national production would cover domestic demand, and the rest would be supplied by foreign wines.
Despite this, everything indicates that in the face of this situation, more and more producers have taken on the task of generating solutions that benefit everyone and create a space for high-quality wines such as Mexican wines. If you liked this article, we invite you to visit our blog, where you will find more information about wines and the world of wine.
