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The Covid 19 pandemic and the resulting deterioration of the economic situation are the most acute threats to the wine industry. It is pushing challenges such as health policy, climate change and the international trade war into the background. These were the findings of an industry survey conducted by Geisenheim University on behalf of ProWein, which polled experts from 49 countries across the wine industry's value chain.
According to the "ProWein Business Report", it is the first survey worldwide to quantify the global impact of Covid-19 on the wine sector and to measure expectations for the future direction of the wine industry.
For example, hotel and restaurant closures caused by the pandemic have led to a global disruption of wine sales channels. Grocery and online retailers, and to some extent wine retailers, have benefited from these shifts in many countries. However, the lack of foreign tourists due to Covid-19 would have led to a sharp drop in local wine consumption in many wine-producing countries.
Due to the simultaneous effects of the pandemic worldwide, there has also been a global decline in wine exports, especially to countries with high wine consumption on social occasions and in restaurants. The industry expects only a very slow recovery of tourism and exports and anticipates a further deterioration of the economic situation in 2021. For the majority of wine producers in Spain, France and Italy, several of their strongest sales channels in terms of value and volume would be negatively affected at the same time. The increases in online sales could not compensate for this by far.
In the view of the experts interviewed, the sudden collapse of important sales channels and export markets will lead to wine producers having to diversify more strongly in order to reduce their dependence and the risk of individual channels and markets. This will only be possible through further company growth or cooperations in order to make additional specialisation in distribution possible and to achieve the necessary sales volume. Two out of three producers interviewed expect negative effects of the Covid 19 crisis on the industry to such an extent that some of the producers will not survive economically. This will lead to a further acceleration of the already existing structural change, from which fewer but larger companies will emerge.
(uka / Photo: ProWein)