Key Findings:
Western Europe is crucial for global wine volume growth: The UK, Italy, France, and Germany are major wine consumers, holding a 36.8% volume share in 2023.
Global wine sector growth: The sector's value is projected to grow at a 6.1% CAGR, reaching $448 billion by 2028, but volume growth will be slower at 1.5% CAGR.
UK and Italy leading growth: The UK is expected to see a 4.7% volume CAGR, while Italy will have a 2.7% CAGR.
Western Europe's contribution: The region will see sales value increase to $233 billion by 2028, with a volume increase of 12 million hectoliters.
Factors influencing demand: Easing inflation and wage growth are driving consumer spending on wine, while warmer weather in higher latitude countries is boosting production.
Challenges to the Global Wine Sector:
Climate change impact: High temperatures, droughts, and water scarcity are affecting grape yields in traditional wine-producing regions like Spain and Chile.
Extreme weather events: Sudden temperature fluctuations, such as those experienced in Germany, are also posing challenges for wine producers.
Changing consumer preferences: Growing health consciousness is leading to increased demand for low/no-alcohol wines, creating challenges for producers to maintain quality while lowering alcohol content.
Competition from other beverages: Wine's value share is projected to decline compared to beer, cider, and spirits in various regions.
Conclusion:
While the global wine sector is poised for growth, it faces significant challenges due to climate change, changing consumer preferences, and competition from other alcoholic beverages. Western Europe's demand will be a key driver of volume growth, but the industry needs to adapt to these challenges to maintain its momentum.
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