The global wine market is in flux these days and much of the attention is focused on falling consumption in the post-pandemic era. Global wine consumption actually peaked a few years ago, as the graph above shows, but the trend was disguised for a while by Covid pantry-stocking and other factors.
The falling sales volume is a stark fact that concentrates the mind, but it isn’t the only wine market change to consider. The strong trend of premiumization seems to have lost momentum, too, which may be related to a growing affordability crisis affecting many products including wine. (It is noteworthy that both Burberry’s luxury stores and Dollar Tree budget stores are experiencing sales declines associated with strained consumer budgets.) Do consumers think wine is good value for money?
Bottle of White? Bottle of Red?
Another trend that bears watching is the shift (in both production and consumption) from red to white wine (increased rosé sales are also part of this pattern). The change is so dramatic that last year the OIV produced a special report on the topic. The OIV data for wine production shows a dramatic shift from red to white (see below). Like the decline in global wine consumption, this trend started a few years ago but has picked up steam (and attracted attention) recently.
The figure below provides a demand-side picture of the situation. Global white wine sales (by volume) held up better in the current climate than did red wine sales, so white’s share of the pie has grown. Changing production is a response to shifts in demand. Good news for white wine producers like New Zealand. Not-so-good for red wine producers like Argentina and Spain.
The changing color of wine shows up in both the data and on the store shelves. We have encountered more examples of white wines made from red grapes, for example, as producers look to align production with demand within the constraints of existing vineyard varieties. White Malbec from Argentina? It was the surprise hit of one of our tastings. White Pinot Noir from Oregon? Yes, that’s a thing now, too, and it can be very nice.
The China Syndrome
Part of the global decline in red wine production and consumption is no doubt due to the collapse of the Chinese wine market in the last ten years (wine production and sales in China are disproportionately red) as shown in the graph below.
French Paradox?
The pattern of changing red-white consumption differs considerably among the largest consuming countries. In France, for example, the volume of red wine sales has trended down for many years, with white and pink wines holding their own.
Do you remember the “French Paradox”? That was the title of the 60 Minutes program segment about how the French stay healthy in part by drinking red wine. It helped power a red wine boom in the U.S. Well, it looks like we have another paradox on our hands now as French red wine consumption slip slides away at the same time, we are told, that consumer interest in health has increased.
American Exceptionalism?
In the United States, on the other hand, red wine sales by volume have been stagnant (premiumization has pushed value up, however). White wine sales (and pink too, to a lesser extent) have risen modestly as measured by volume (see below) The red shift in U.S. wine consumption is less pronounced than in China or France … so far.
(Note that the OIV data shown here end in 2021, before U.S. wine consumption began to sharply decline.)
The NIQ sales data for the U.S. (found in the most recent issue of Wine Business Monthly) suggest that this red-to-white trend may be accelerating. Total sales value for the most recent 52 weeks, for example, was $9,172 million for red wine and $7,857 for white wine (red still leads by dollar value). But this pattern changes when you look at the most recent four survey weeks, where white wine’s $619 million outpaces red wine’s $583 million. Seasonal factors surely account for some of white wine’s lead, of course, but it still comes as a surprise.
The shift is more dramatic when measured by volume of sales. For the most recent 52 weeks the numbers are 72.9 million cases of red wine versus 79.9 million cases of white wine. White’s lead lengthens for the most recent four weeks. Measured white wine sales were 6.2 million cases compared with 4.7 million cases of red wine.
The patterns of red-to-white sales shift differ by country, but the fact of the global trend seems pretty clear. What’s behind this surprising change in consumption patterns? Every time I come up with a simple answer to this question I quickly find a reason to dismiss it, so I won’t bore you with my theories. I note that the OIV report is long on factors but shorter on analysis, too.
Does “red wine gives me headaches” have anything to do with it?
Great article, as always, Mike and very interesting patterns of production & consumption. Had no idea that white wine was such a big part of US consumption (my friends are almost all red wine drinkers). Curious how much of the shift is driven by consumers with concerns about alcohol content–whites obviously are a way to reduce that. Cheers!
White wine often has similar flavor profiles to hard seltzer. White wine is less expensive typically, with lower alcohol. It all fits with current consumer trends. Next up, the Riesling Uprising!!
Fingers crossed!
Great analysis, Mike. It intrigues me the data that shows white whine production exceeding reds since 2012 (figure 1), whereas, despite the trend, reds consumption still dominate (figure 27). Any possible explanation for that?
There are some peculiarities to the way OIV does its data. They generally show total production exceeding total consumption, for example.
Very interesting. Is red meat consumption up or down over the same time periods? Does this year allegedly being the hottest on record have anything to do with it?
Price seems like a plausible theory. I recently did a search (and purchase) of wines $20 and under on the site of a major DC retailer. There were many more whites listed than reds.
I tend to discount the theory on alcohol levels. Until very recently, white wines have been trending between 13% and 14.5% lately. Thankfully, that seems to be coming down this year, with a lot of wines being listed as 12.5ish.
I have to say that for myself, consumption of white wine has greatly increased. I can chalk that up to the fact that my red meat consumption has declined and my ingestion of more vegetable and fish-based meals has increased. As one who likes to try and match wine and food, the move from red to white seemed necessary and appropriate. This change has been based partly on economics and partly on trying to have a healthier diet. All in all, this change, at least for me seems obvious.
One reason white wines might be increasing is that in general they are at a lower price point and it’s easier to make a quality white than a red that might be hit or miss.
Or just maybe, it’s just getting too damn hot everywhere, so white and pink are more enjoyable and easier to drink? (tongue partly in cheek)
Mike, very interesting the fact that White wines are gaining ground to the Reds. Do you consider it this a trend , or is here to stay?
best anabelle
Mike, thanks for for this interesting article. If I had to guess on top 2 factors, I would say it’s because whites are lower alcohol and there’s already a trend of lower alcohol wines.
I’d also look at the trend of red meat – consumption and price, as that’s often consumed with red wine. The real (vs nominal) price of red meat has probably increased decreasing consumption along with health-conscious related decline in consumption.
Finally, let’s not forget the warming planet may favor whites!
Cheers
Ayele Solomon
Honey Wine Co