The Italian Wine and the Market Challenges

 Good news regarding the Italian wine and its performance in foreign markets. Although it is small news, it is however good and, despite everything, evidently better than bad news, especially in these times. Wine – undeniably, as said over and over again – in recent years has certainly not shone in sales and, so to speak, has certainly experienced decidedly better times. The causes are many and well known to all, including the upheavals introduced during the recent Covid-19 pandemic, not least the consequent current economic and market conditions which have seen wine facing new scenarios. Among these, the well-known competition with beer, a drink that has always competed for the podium with wine, which, lately, seems to be more favored in consumer preferences. If this were not enough, in recent years competition has further increased as a result of the latest habits and fads associated to certain new drinks.

 The 2024 edition of the Annual Report Valoritalia – published in the recent past days – gives an image of the Italian wine which, between ups and downs, offers a glimpse of optimism for the future, with positive results, although of modest magnitude. The Valoritalia study examines the production and marketing of Italian wine in 2023, comparing it to 2022, as well as a preliminary investigation on the trend in 2024. In general terms, the volume of bottled wine produced by Italian wineries has increased of 0.54%, a result that achieves 2.8% more than the average of the previous three years. As mentioned, it is not a sensational result – definitely modest – but it however is a sign of recovery in light of the results of recent years. The performance of 2023, however, ended in a controversial way, as many of the aspects examined recorded decidedly negative results.

 One of these is the economic value of bottled wine, which has, on the contrary, decreased. In other words, more wine was bottled, but the profit was lower. Valoritalia's annual report analyzed data relating to 219 denominations of origin, which represent 56% of the Italian production of quality wines with over two billion bottles placed on the market. As regards production results, in 2023 the territory of North-West Italy saw its volume decrease by 8.3% compared to 2022, while the wineries of Central Italy recorded a decrease of 5.3%. The best result, in this sense, was achieved by the wineries of the North-East, with an increase of 3.7% compared to 2022, a result that was particularly achieved thanks to the growth in production of the Asolo DOCG and Veneto IGT denominations.

 As regards the trend of denominations – as had already emerged in other research – those belonging to the Indicazione Geografica Tipica (Typical Geographical Indication, IGT) category are driving the growth of Italian wines, which, alone, record an increase of 16.5% equivalent to over 97.6 million bottles. On the other hand, wines produced in the territories with Denominazione d'Origine Controllata (Denomination of Controlled Origin, DOC) recorded a decline of 2.8%, while those with Denominazione d'Origine Controllata e Garantita (Denomination of Controlled and Guaranteed Origin, DOCG) recorded a drop of 8%. The result of denomination wines, at the end of 2023, recorded an overall decrease of 1.3% compared to 2022. If 2023 showed a timid increase in the volume of bottled wine, 2024 instead gives hope for a much better result. In fact, in the first four months, the volume of bottled wine increased by 1.1%, therefore more than double the overall result achieved in 2023.

 Market challenges are, last but not least, also regulated by new trends as well as by the social and cultural changes of recent years, conditions that producers are forced to follow precisely with the aim of maintaining or gaining precious market shares. According to what emerges from a study by Nomisma-Wine Monitor and commissioned by Valoritalia, wine consumers seem to be particularly interested in issues related to sustainability and environmental protection, as well as respect for ethical and social values. This consumer orientation – in fact – has influenced the strategies and production policies of many wineries, so much so that 93% of Italian companies today consider sustainability a fundamental aspect for their development. After all, it is about the old but always valid, as well as indissoluble, link between supply and demand: consumers ask for greater sustainability, producers adapt, trying to offer what the market asks for and sells.

 In the same way, wineries – if they intend to maintain their market shares and conquer new ones – are offering consumers styles of wines which, both as a result of new trends and to counter the crisis of recent years, seem to attract greater interest from consumers. So they adapt their production, or start new and specific ranges, to what are the current trends and fads in terms of enology. In fact, fermentation and aging of wines in “new containers” are making their way which, until a few years ago, certainly did not enjoy the favor of the majority and which today have become, almost by magic, the new wine religion. In this regard, it is surprising to see how certain producers – who in the past were extremely critical of certain winemaking practices – are now convinced supporters of them. How times and ideas change, especially when you look at your not exactly good balance-sheet.

 It is certainly understandable that in these cases they must make a virtue out of necessity and, in some way, the wineries – which are first of all businesses – have the primary priority of producing a profit, even at the cost of denying their positions of the past and embrace new fads and what the market is demanding. Regardless of what the reasons are, the fact that Italian wine achieved positive results in terms of sales in 2023 and, even more so, in the first quarter of 2024, is good, very good news. Trusting that this result can be confirmed and improved during 2024, these are important signals that certainly point to a less uncertain future for Italian wine. Without forgetting – not least – that the producers of other countries also find themselves, more or less, in the same condition and they all compete in the same markets. At this moment, it seems, Italian wine is winning the market challenge, although with timid results, nevertheless encouraging and which are certainly welcome. At least to face the future, especially the next one, with greater optimism and confidence.