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Beverage NewsWine & Spirits

US wine market hits record sales

California wines lead the category

news
April 9, 2013

Wine sales in the United States from all production sources increased 2 percent from the previous year to a new record of 360.1 million 9-liter cases with an estimated retail value of $34.6 billion, according to Wine Industry Consultant Jon Fredrikson of Gomberg, Fredrikson & Associates, Woodside, Calif. Of this total, almost two-thirds or 207.7 million cases of California wine account for a 58 percent share of U.S. wine sales with an estimated retail value of $22 billion, he says. Including exports, California wine shipments to all markets in the United States and abroad reached 250.2 million cases in 2012, he says.

"The U.S. is the largest wine market in the world with 19 consecutive years of volume growth," said Robert P. Koch, president and chief executive officer of Wine Institute, San Francisco, in a statement. "Competition for retail shelf space and consumer attention is intense, so California's high-quality, record wine grape harvest in 2012 could not have come at a better time. California vintners continue to respond to growing worldwide demand with a wide array of outstanding wines from regions throughout the state, and Wine Institute is supporting the effort by opening markets and eliminating trade barriers in the United States and abroad."

Fredrikson notes that wine shipments to the United States market increased nearly 50 percent since 2001, and it is likely that American consumption will continue to expand during the next decade as wine continues to gain traction among Americans of legal drinking age. "The amazing diversity of choices and exciting new offerings are attracting new consumers and boosting consumption,” he said in a statement. “Among the key growth drivers are favorable demographics, a widening consumer base and increasing points of distribution in both on- and off-sale outlets. For example, Starbucks is now serving wine in some key markets, and amazon.com and Facebook Gifts both sell wine online."

Wine sales in U.S. food stores and other off-premise measured channels from all domestic and foreign producers grew 2 percent in volume and 6 percent in sales, according to New York-based market research firm Nielsen. California wines grew faster than the overall category by a full percentage point, it notes. Chardonnay remained the most popular varietal with a 21 percent share of category volume, followed by Cabernet Sauvignon with 12 percent, Merlot with 9 percent, and Pinot Grigio/Gris holding 8 percent share, it says. The largest percentage gains came from Muscat/Moscato, which was up 33 percent in volume with 6 percent market share, and domestic red blends/sweet red wines, which were up 22 percent in volume with 5 percent share of market, it says. Malbec also was up 21 percent by volume and now holds 1 percent market share, it adds.

"Consumers have more access to wine throughout the country with wine-selling locations expanding by well over 50,000 from five years ago,” said Danny Brager, vice president of the beverage alcohol practice at Nielsen, in a statement. “Off-premise retail outlets grew 15 percent to almost 175,000 outlets, while restaurants and other on-premise outlets increased 12 percent to 332,000 locations in the United States. Retailers recognize that wine is a large and growing category, even in economically challenging times, and tends to attract upper income consumers and all legal drinking age groups. Wine also pairs well with food, leading to larger, more profitable shopping baskets."

For sparkling wine and champagne, shipments reached 17.7 million cases in 2012, up 2 percent compared with the previous year, Wine Institute reports. California sparkling wine grew 3 percent with Moscato-based varieties driving the growth, it says. While overall total 2012 volume slowed after a major surge in 2011, sparkling wine shipments to the United States in 2012 were at their highest level since 1987, it adds.

Overall U.S. wine exports, 90 percent of which came from California, reached $1.43 billion in winery revenues in 2012, which is an increase of 2.6 percent compared with 2011, Wine Institute reports. Volume shipments reached 424.6 million liters or 47.2 million cases for the year, it states. Top markets for California wines include the European Union, which accounted for $485 million in sales, up 1.7 percent from the previous year; Canada, which is up 14 percent at $434 million; Hong Kong, which dropped 30 percent to $115 million; Japan, which rose 6 percent to $111 million; China which jumped 18 percent to $74 million; Vietnam, which was up 22 percent to $27 million; Mexico, which rose 4 percent to $20 million; and South Korea, which jumped 26 percent to $16 million.
 

KEYWORDS: California wines international wine Malbec moscato wine

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