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Wine value growth to slow in next five years, says Mintel

Published:  07 November, 2014

Wine's value growth, up to now bolstered by duty and price increases, is likely to slow in the next five years as consumer concerns over costs, alcohol and sugar content grow.

Wine's value growth, up to now bolstered by duty and price increases, is likely to slow in the next five years as consumer concerns over costs, alcohol and sugar content grow.

That's according to the latest Wine report from Mintel, which says 2014 will see an annual value growth of just 0.8%.

In 2013, sparkling and still wine sales hit £12.51 billion, but Mintel says growth will taper off. It does however anticipate that the value of the wines market will edge up by 13% in the next five years to £14.27 billion, putting this down to rising inflation and gradual improvements in consumer confidence.

MintelMintel's forecast of UK value retail sales of wines, 2009-19

Volume sales fell to 1.31 billion litres in 2013 and are likely to carry on declining in the lead up to 2019 as fewer adults are buying wine than last year. But the research firm said "total wine market volumes should eventually start to flatten out". It states that value sales for the still wine market alone should hit £12 billion by 2019.

Red wine glasses and bottle

Mintel paints a fairly gloomy picture for Champagne, which is suffering as sparkling wines continue to gather momentum. "Sparkling wines have grown notably in credibility and are accepted across all income groups as a suitable gift and cheaper alternative to Champagne. That consumers are happy with the quality of sparkling wines means it is unlikely they will revert to Champagne given its higher price tag."

Value sales of sparkling wine grew by 14.1%, reaching £930 million in 2013 and are expected to reach £999 million in 2014.

Meanwhile fortified wine continues to be "a low-profile but fairly steady category" in terms of performance. Value sales increased by 1.5%, reaching £423 million in 2013. The growth of sherry bars is likely to have helped; but Mintel cautioned that inflation is likely to have contributed to most of the growth. While a small volume and value decrease are on the cards for 2014, it's likely to decline further after that.

Colette Warren, food and drink analyst at Mintel, said: "The scope to increase value sales is limited by the heavy promotional activity that is both accepted and expected by shoppers. Therefore, other avenues such as clearer information about the differences between more and less expensive wines and the opportunity to sample wines before buying may be better placed to help limit the perception of risk and drive uptake."

Mintel's Still, Sparkling and Fortified Wine in the UK report is available here, priced £1,750. It uses IRI and Mintel data.

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