Agriculture Reference
In-Depth Information
producer. More importantly, China is seen as an important trade partner (for wine
and services) by most countries. Similar to other new wine countries, the consolida-
tion of a domestic industry in a developing market involved early bulk import of
wine and winemaking skills until the country is able to manage and maintain its
production using local facilities and skills. China will be no exception but represent
a modern market opportunity.
The Global Wine Industry
Following the sustainable establishment of their domestic industries, most countries
have adopted protection strategies. Some for commercial reasons (such as regional
branding), but often to preserve quality and style within a region. The concept of
“appellation” is now adopted in most wine countries, but the basis of the defini-
tion of the regional zoning varies greatly from rather simple in the New World to
complex integration of biophysical, social, historical and political influences in the
Old World. Traditionally, Old World countries have designed systems of produc-
tions that are highly regulated, including the legislation of grape varieties within an
appellation, pruning and training practices, specific planting densities, nominated
harvest periods and yields as well as specific winemaking techniques. By contrast,
New World countries are highly sensitive to market liberalism and have tradition-
ally legislated far fewer constrains. As a result, the concept of “terroir” in France
represents the unique relationship between the location of production (including the
soil and climate) of a product, its traditional production practice and its raw ingre-
dients. This concept is present in many Old World countries and is now protected
under international trade law. The global wine industry uses the concept of regional-
ity as an important marketing tool to stimulate demand.
The FAO evaluates the global world wine production at 28.7 million t in 2011,
produced by 70 countries (note that FAO uses tons as a standard measure of produc-
tion output). The top ten larger producers accounted for 84 % of the global produc-
tion. France accounted for 23 % of the global production, Italy 16 %, Spain 12 %,
the United States of America 8 %, China 6 %, Argentina 5 %, Australia and Chile
4 % each and South Africa and Germany 3 % each (Fig.
7.1
). Of the top five large
producers, Italy Spain and The United States of America display a clear decrease in
production in the past 6 years, in line with a global wine crisis. By contrast, France
reviewed its approach to wine marketing and increased production. Similar, China
displayed a steady growth, albeit from a lower base (Fig.
7.1
). Markets such as
France, Italy and Spain were very strong net exporters of wine, while developing
markets such as the USA and China export very little when compared to the volume
of total wine traded (Fig.
7.1
).
The statistics presented in Fig.
7.1
clearly demonstrates the importance of the
Old World traders such as France, Italy and Spain. Not only do they produce a lot
of wine but they also export large volumes, hence consolidating their marketing
strategies.
