Indian Wine Export Potential

Export Potential of Indian Wine Industry Research Report by Pankaj Muthe in Association with Organized by Pankaj Muthe www.siddhimanagement.com

Research Objectives
Primary objective:-
To Study Potential of Wine Exports for The Indian Wine Industry
Secondary objective
Study Indian wine industry
Potential of Indian market and performance of Key players
Role of Government to promote wine industry
Government regulations
Study Global wine industry
Key players in the global wine trade
Study the macro environment like, impact of global policies like WTO and its impact on this industry
Pankaj Muthe www.siddhimanagement.com

Nature & Analysis
NATURE OF RESEARCH
Data from questionnaire was objective.
Data from other sources was subjective in nature.
ANALYSIS OF THE DATA
The objective data will be analysed using statistical tools like Annova, Regression, and Correlation etc wherever needed and research software like SPSS will also be used if and when needed.

INDIAN WINE INDUSTRY An Overview Pankaj Muthe www.siddhimanagement.com

Viticulture – Indian Scene
Table grape production is very old.
Grape cultivation for wine is very new.
98% grape production is for table purpose or resin making.
Only Approx 3500 Acres wine grape plantation against 1,25,000 Acres plantation of Table grapes in Maharashtra

Consumption
There is a huge demand for wine in the domestic market due to the change in food habits and changing lifestyle.
Wine is considered as a health drink, normally taken with food.
The domestic wine industry is in the nascent stage and not yet matured .

Consumption
The per capita consumption of wine in Europe is 60 litres and in other matured countries it is 25-30 litres.
T he per capita consumption of wine in India is less than a litre.
wine consumption in the country is increasing at a rate of over 20 per cent per year, and this growth rate is expected to continue for at least the next five years.

Consumption
The largest market for wine in India is Mumbai, followed by Delhi, Bangalore, Goa, Kolkata, Pune and Rajasthan.
The current domestic production of wine is estimated at 5.0 million litres.
Indian wineries have planned expansion plans to meet the increasing demand.
The wine industry has a potential of 100% growth rate over next 5 years.

Indian Players
The industry is dominated by three players
Indage
Sula wines
Grover wines
They enjoy major share of the Wine market

Foreign players
There is a strong growth in the imported wine market with Indian importers importing brands
Some of the well-known wine producers are also present in India like
Moet & Hennessey
E&J Gallo
HWWG.

Growth
The wine industry has witnessed a CAGR of over 25% over the last 3 years in the premium wine segment mainly fuelled by the strong growth in the domestic wine consumption.

INDIAN WINE EXPORTS Current Scenario Pankaj Muthe www.siddhimanagement.com

Indian Wine Exports
Indian wine companies are travelling to other countries and are corresponding with various distributors in order to understand the respective country’s governmental policies and distribution channels.
Indian wine is gaining greater acceptance in countries like US and France.
Potential markets for Indian wines are China, Singapore, Japan, Nepal and Bhutan.
Our wine companies have not yet exploited countries like Australia, Chile and South Africa, which have made a name for them in the wine market .

Indian Wine Exports
Indian wine exports increase at 9% growth rate
At present, India exports about 10 lakh bottles a year .
Wines: Exports from India
2003-04 Rs. 107 lakh 2004-05 Rs. 158 lakh

Indian Wine Exports
India a minnow in the world of wine
Wine Production of India is only 5 million litres

World production of wine 12 leading countries Pankaj Muthe www.siddhimanagement.com

Indian Wine Exports
Major Destinations for exports
UAE, Thailand, Nepal, Maldives, Ghana
Opportunities for exports
World class quality of wine
Proximity to markets in East and West Asia and Europe

GLOBAL WINE INDUSTRY Pankaj Muthe www.siddhimanagement.com

KEY FACTS
Total production of grape wine in the world is 32,000 million liters.
Total consumption of grape wine in the world is 26,000 million liters.
The Old World Wine & New World Wine
France, Italy, Spain, Germany, Australia, America, South Africa, Chilli etc. are the major wine producing countries in the world.
The world wine business is valued at EUR 150 billion for consumer value and EUR 60 billion for wholesale value.

KEY FACTS
The total global production of wine averages round 275 million hl per annum. Of this, some 220 million hl are consumed and the remainder is distilled as cognac, brandy, and alcohol or removed from the market through EU subsidies.
Exports of table wine account for 27 per cent or 60 million hl, and in 2002 represented a value of EUR 13 billion, making it one of the most traded food products.

World production by continent Pankaj Muthe www.siddhimanagement.com

World consumption of wine Pankaj Muthe www.siddhimanagement.com

Global Wine Consumption 12 leading countries Pankaj Muthe www.siddhimanagement.com

Per capita wine consumption
Calculation taken from FAO 2003 demographics data base

Degree of market equilibrium in the world of wine
Difference between wine production and consumption
for the main producer countries

Wine Producing Countries & Markets
France
Italy
Australia
Spain
Chile
USA
South Africa
Argentina
United Kingdom
Japan
Canada
China
South Korea

FRANCE
Titled as the world's largest wine producer many times .
France leads the world in per capita consumption of wine
French exports represent more than 30 percent of total French production
French imports consist of bulk table wine

ITALY
Destinations for italian wine were germany (38 percent), france (23 percent), and the united states (8 percent) in volume terms.
Italian exports to France consist mainly of bulk table wines (96 percent of total) while 80 percent of total shipments to the United States are bottled wine

AUSTRALIA
Exceptional advancements in both wine industry growth and international marketing have made that country the envy of other export-minded nations
Formation of the Wine Vision Group
Australian Wine Research Institute and Grape and Wine Research and Development Corporation are leaders in such fields of study

SPAIN
Spain's vineyard acreage is the largest in the world
Total Spanish wine production ranks only third behind France and Italy.

CHILE
More than 60 percent of Chilean wine now goes to overseas markets, including India - the highest national wine export level in the world.
Despite being only the 9 th largest producer, Chile had 3.5% of the total export market and was ranked 6th in the world.

USA
The three top markets for U.S. wines are Canada, the United Kingdom (U.K.) and Japan, which together accounted for about 54 percent of the value
Markets are targeted under the Market Access Program (MAP)

USA
U.S. Wine Exports to Japan Rebound
New Markets Continue to Grow
U.S. Wine Imports Continue to Grow
Grapes of wealth for the US wine market
Red wines outsell whites in the US
U.S. wine export revenue up 28% in 2004
Napa Wine worth $9.5 billion
International challenges facing U.S. wine industry
Competition To Intensify
Trade Issues
U.S. Government Programs

SOUTH AFRICA
Good to excellent soil and climatic areas for additional vineyard development .
Recent U.S. studies on the South African wine industry conclude s tha t
Good time for those interested in establishing long-term business relationships
With growth potentials to get into the market and start building up a consumer base and brand image.

ARGENTINA
Argentina has developed several organizations to help boost the quality of the wines with the intent of increasing their presence in the export market
5 th largest producer of wine in the world
10 th position in the total export market in the world

UNITED KINGDOM
"Crucible" for the global wine market
British import market was second only to the German market

JAPAN
Steady increase in the size of its imported wine market .

CANADA
More governmental constraints to competition in Canada

SOUTH KOREA
Competition strong for South Korea's robust wine market
The market is still developing
Rules of the Road

CHINA
Increased market opportunities .
China's entrance into World Trade Organization

STRATEGIES FOR EXPORTS
High Delivery Costs Erode Advantage of Low Cost Production
Improvement in Logistics
Investment in Supply Chain Infrastructure
Negotiating better freight rates with advance shipping schedules
Develop Brand INDIA

THANK YOU !!! Pankaj Muthe www.siddhimanagement.com
Pankaj Muthe
www.siddhimanagement.com
[email_address]
+91-9822501850

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Indian Wine Export Potential

by Pankaj Muthe on Apr 30, 2010

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