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US fine wine industry to suffer slump in 2008

Published:  23 July, 2008

Despite a positive overall picture in the US wine industry, sales of fine wine are set to slump as we move into 2008.

This is the verdict from the 2008/2009 State of the Wine Industry Report from Silicon Valley Bank (SVB) - an annually-conducted study revealing trends within the US wine industry.

The report stated this decline of fine wines sales follows a record year in 2007 for the segment where sales grew at approximately 20%.

It continued: "For fine wine, we expect 2008 growth rates in the low-teens and

slightly lower profits.

"Concerns in this segment include everything from high costs of sought after vineyard properties, foreign competition, brand proliferation, a weak USD, grape shortages, distribution over- consolidation, regulatory processes impacting free trade, and evolving - yet still inefficient - internet and consumer sales models."

Last year, consumption of both foreign and domestic wines in the US reached $30 billion (15.3bn).