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German wine exports on the rise

03/03/2020

Sales of German wines abroad experienced an overall positive development last year. According to the German Wine Institute (DWI), the quantity of exported wine rose by 3 per cent on the previous year to 1.04 million hectolitres.


However, the total value of exports dipped by 0.6 per cent to 305 million euros and the average price by eleven cents to 2.93 €/litre. “This development is first and foremost the result of the high-yield vintage of 2018, which followed an unusually low yielding harvest in 2017. Due to the larger wine supply, the hitherto record average price for our wines was often not sustainable in the highly competitive export markets,” DWI managing director Monika Reule explained.

Important export markets

Also on the decline last year was Germany´s most important wine export market USA. This is also most likely attributable to the continued decline in wine consumption in the world´s biggest wine market, which was first recorded in 2018 after many years of growth. For German wine exporters, this resulted in a drop in wine export quantities of four per cent to 164,000 hectolitres, with a concurrent decrease in sales revenue of nine per cent to 65 million euros.

The US trade tariffs of 25 per cent on German wines introduced in October have not yet affected the 2019 balance sheet. However, they will most certainly have a pronounced negative impact in the course of the year.

On the other hand, the removal of wine import tariffs in Japan through the JEFTA free trade agreement, which came into force in February 2019, had a correspondingly positive impact on German wine exports. This enabled German wine exporters to realise in Japan a 17 per cent growth in volume and an increase in value of 13 per cent.

German wine exports to Scandinavia and Denmark continued to develop positively in 2019. Total exports to these four countries have since amounted to 182,000 hectolitres worth 56 million euros, resulting in a four per cent increase in value and two per cent in volume.

In China, the average price reflected a successful reversal of the trend by increasing 35 cents to 5.17 €/litre. Consequently, the value of wine exports to Germany´s fifth most important wine export market rose by two per cent to 17 million euros. At the same time, however, export quantities fell by 5 per cent to 33,000 hectolitres. With regard to the Corona virus epidemic, the DWI foresees noticeable declines in business with China for the first few months of this year.

In view of the existing trade conflicts, the impact of Brexit and the uncertainties presented by the corona virus, DWI managing director Monika Reule anticipates increased competition this year on the international wine markets. “In 2020, it will be a challenge to maintain the current level of wine exports,” said Reule.

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