On the face of it, 2017 offered plenty of signs that it would be a bad year for the Italian wine industry. Production levels tanked to the lowest that they have been since before World War II. That alone makes it seem as though the industry would experience something of a bleak period. In fact, production levels fell over 25% compared to what they were in 2016.
But that couldn’t stop the Italian wine industry.
Despite these low production numbers, the industry is stronger than ever. In particular, Ital now exports more wine than it has at any other point in the industry’s illustrious history.
Recent figures have revealed that exports shot up 7% during 2017. Moreover, sales shot up to €6 billion.
Those are huge numbers, and they make for a record-breaking year for the industry.
Let’s dig a little deeper into those numbers before looking at some of the reasons behind them.
So there’s more money and more wine being shipped out of Italy than ever before. Italy now holds the world record for the most amount of wine produced, beating even its biggest rival of France.
Today, Italy has a production capacity of 40 million hectolitres, which translates to more than 5.3 billion bottles of wine. Even with the 25% reduction that the weather conditions of 2017 caused, that still means the country can produce 30 million hectolitres.
Approximately 40% of that maximum capacity goes towards the production of the DOC and DOCG wines that many consider the lifeblood of the Italian wine industry. A further 30% goes towards the production of IGT wines, while the rest is dedicated to table wines and mass-produced drinks.
That alone should lend you some sense of scale when it comes to the Italian wine industry.
Those huge production numbers allow for the increased exports that Italy enjoyed during the year. Italy sold 6% more wine in the United States, with the €20 million “Made in Italy” campaign doing a huge amount to raise the industry’s profile in the USA. The UK offered 8% growth, no doubt fuelled by the country’s love affair with Prosecco, while Germany enjoyed 3% growth despite having a thriving industry of its own.
However, it’s the new markets that really came to the fore during the year. Russia, which has not typically been seen as a wine market, offered a 47% increase, making it the country where the Italian wine industry enjoyed some of its highest gains. The Chinese market also grew, with a 25% increase in sales showing that Italy is making up for lost time in perhaps the world’s leading emerging wine market.
It’s not all good news though. Despite the growth in China and the United States, the French wine industry still tops the export charts for both countries. However, any growth at all is still good news and there’s no reason why the Italian wine industry can’t expect to make further gains over the coming years.
It’s a positive pattern, and one that may only be affected if the climate results to lower than expected production levels for several years in a row.
But what are the reasons behind so many countries falling so deeply in love with Italian wine.
The Quality/Price Ratio
If you’re looking for why Italian wine exports to the United States have improved, look no further than Gambero Rosso. One of the country’s leading critics, Rosso often espouses the quality of Italian wines and his rating system is among the most trusted in the world.
He believes that the Italian wine industry has enjoyed growth in the US and elsewhere because of a combination of high quality and affordable prices.
As he puts it: “”Italian wines are the new wave for high-quality wines for Americans.
“Quality is higher than Spain, but in price we are lower than France.”
That is perhaps an oversimplification, but the point still stands. The Italian wine industry has become a leader in terms of quality and more people are starting to recognise that French wines aren’t the be all and end all of the international wine industry.
The realisation that such quality doesn’t come at a bank-breaking cost only further helps the Italian wine cause. More people are willing to spend money to take a risk when they know that buying a bottle of wine won’t cost too much. Upon tasting and experiencing the quality of Italian wines first-hand, they’re also more likely to keep buying, leading to growth.
We’ve spoken before about the importance of the emerging markets in China, India, and Russia. The new figures show just how important they’ve become.
Massive sales increases in both China and Russia have gone a long way to contributing to this record-breaking year for the Italian wine industry. Russia now favours Italian wine above all others, and it appears the country is undergoing a slow transformation in tastes away from its traditional drinks and towards the nectar of the grape.
China is a bit of a tougher market to crack, but the industry is making headway there too. A slow start may have put Italy behind the likes of France in China. However, a full-blown marketing effort is determined to help Italy ascend the ranks and become the exporter of choice in China.
That effort may take a few, or even many, years to come to fruition. However, the upwards trend for the Italian wine industry elsewhere suggests that those efforts will not be in vain.
The Final Word
Despite worrying production numbers in 2017, the Italian wine industry continues to go from strength to strength. The huge demand for the country’s product has led to sales and exporting records being broken, which stands the industry in good stead for the future.
The only possible issue is those lower production numbers for 2017. If such issues continue for several years, Italy may struggle to supply the demand it has created. However, the Italian wine industry is the strongest it’s ever been, at least for now.