Indian Wine Export Potential


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Potential for Indian wine exports, Competitor study, Country profiles, consumption, market drivers, strategies and recommendations

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Indian Wine Export Potential

  1. 1. Export Potential of Indian Wine Industry Research Report by Pankaj Muthe in Association with Organized by Pankaj Muthe
  2. 2. Research Objectives <ul><li>Primary objective:- </li></ul><ul><ul><li>To Study Potential of Wine Exports for The Indian Wine Industry </li></ul></ul><ul><li>Secondary objective </li></ul><ul><ul><li>Study Indian wine industry </li></ul></ul><ul><ul><li>Potential of Indian market and performance of Key players </li></ul></ul><ul><ul><li>Role of Government to promote wine industry </li></ul></ul><ul><ul><li>Government regulations </li></ul></ul><ul><ul><li>Study Global wine industry </li></ul></ul><ul><ul><li>Key players in the global wine trade </li></ul></ul><ul><ul><li>Study the macro environment like, impact of global policies like WTO and its impact on this industry </li></ul></ul>Pankaj Muthe
  3. 3. Nature & Analysis <ul><li>NATURE OF RESEARCH </li></ul><ul><ul><li>Data from questionnaire was objective. </li></ul></ul><ul><ul><li>Data from other sources was subjective in nature. </li></ul></ul><ul><li>ANALYSIS OF THE DATA </li></ul><ul><ul><li>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. </li></ul></ul>Pankaj Muthe
  4. 4. INDIAN WINE INDUSTRY An Overview Pankaj Muthe
  5. 5. Viticulture – Indian Scene <ul><li>Table grape production is very old. </li></ul><ul><li>Grape cultivation for wine is very new. </li></ul><ul><li>98% grape production is for table purpose or resin making. </li></ul><ul><li>Only Approx 3500 Acres wine grape plantation against 1,25,000 Acres plantation of Table grapes in Maharashtra </li></ul>Pankaj Muthe
  6. 6. Consumption <ul><li>There is a huge demand for wine in the domestic market due to the change in food habits and changing lifestyle. </li></ul><ul><li>Wine is considered as a health drink, normally taken with food. </li></ul><ul><li>The domestic wine industry is in the nascent stage and not yet matured . </li></ul>Pankaj Muthe
  7. 7. Consumption <ul><li>The per capita consumption of wine in Europe is 60 litres and in other matured countries it is 25-30 litres. </li></ul><ul><li>T he per capita consumption of wine in India is less than a litre. </li></ul><ul><li>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. </li></ul>Pankaj Muthe
  8. 8. Consumption <ul><li>The largest market for wine in India is Mumbai, followed by Delhi, Bangalore, Goa, Kolkata, Pune and Rajasthan. </li></ul><ul><li>The current domestic production of wine is estimated at 5.0 million litres. </li></ul><ul><li>Indian wineries have planned expansion plans to meet the increasing demand. </li></ul><ul><li>The wine industry has a potential of 100% growth rate over next 5 years. </li></ul>Pankaj Muthe
  9. 9. Indian Players <ul><li>The industry is dominated by three players </li></ul><ul><ul><li>Indage </li></ul></ul><ul><ul><li>Sula wines </li></ul></ul><ul><ul><li>Grover wines </li></ul></ul><ul><ul><li>They enjoy major share of the Wine market </li></ul></ul>Pankaj Muthe
  10. 10. Foreign players <ul><li>There is a strong growth in the imported wine market with Indian importers importing brands </li></ul><ul><li>Some of the well-known wine producers are also present in India like </li></ul><ul><ul><li>Moet & Hennessey </li></ul></ul><ul><ul><li>E&J Gallo </li></ul></ul><ul><ul><li>HWWG. </li></ul></ul>Pankaj Muthe
  11. 11. Growth <ul><li>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. </li></ul>Pankaj Muthe
  12. 12. INDIAN WINE EXPORTS Current Scenario Pankaj Muthe
  13. 13. Indian Wine Exports <ul><li>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. </li></ul><ul><li>Indian wine is gaining greater acceptance in countries like US and France. </li></ul><ul><li>Potential markets for Indian wines are China, Singapore, Japan, Nepal and Bhutan. </li></ul><ul><li>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 . </li></ul>Pankaj Muthe
  14. 14. Indian Wine Exports <ul><li>Indian wine exports increase at 9% growth rate </li></ul><ul><li>At present, India exports about 10 lakh bottles a year . </li></ul><ul><li>Wines: Exports from India </li></ul><ul><li>2003-04 Rs. 107 lakh 2004-05 Rs. 158 lakh </li></ul>Pankaj Muthe
  15. 15. Indian Wine Exports <ul><li>India a minnow in the world of wine </li></ul><ul><li>Wine Production of India is only 5 million litres </li></ul>Pankaj Muthe
  16. 16. World production of wine 12 leading countries Pankaj Muthe
  17. 17. Indian Wine Exports <ul><li>Major Destinations for exports   </li></ul><ul><ul><li>UAE, Thailand, Nepal, Maldives, Ghana </li></ul></ul><ul><li>Opportunities for exports </li></ul><ul><ul><li>World class quality of wine </li></ul></ul><ul><ul><li>Proximity to markets in East and West Asia and Europe </li></ul></ul>Pankaj Muthe
  18. 18. GLOBAL WINE INDUSTRY Pankaj Muthe
  19. 19. KEY FACTS <ul><li>Total production of grape wine in the world is 32,000 million liters. </li></ul><ul><li>Total consumption of grape wine in the world is 26,000 million liters. </li></ul><ul><li>The Old World Wine & New World Wine </li></ul><ul><li>France, Italy, Spain, Germany, Australia, America, South Africa, Chilli etc. are the major wine producing countries in the world. </li></ul><ul><li>The world wine business is valued at EUR 150 billion for consumer value and EUR 60 billion for wholesale value. </li></ul>Pankaj Muthe
  20. 20. KEY FACTS <ul><li>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. </li></ul><ul><li>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. </li></ul>Pankaj Muthe
  21. 21. World production by continent Pankaj Muthe
  22. 22. World consumption of wine Pankaj Muthe
  23. 23. Global Wine Consumption 12 leading countries Pankaj Muthe
  24. 24. Per capita wine consumption <ul><li>Calculation taken from FAO 2003 demographics data base </li></ul>Pankaj Muthe
  25. 25. Degree of market equilibrium in the world of wine <ul><li>Difference between wine production and consumption </li></ul><ul><li>for the main producer countries </li></ul>Pankaj Muthe
  26. 26. Wine Producing Countries & Markets <ul><li>France </li></ul><ul><li>Italy </li></ul><ul><li>Australia </li></ul><ul><li>Spain </li></ul><ul><li>Chile </li></ul><ul><li>USA </li></ul><ul><li>South Africa </li></ul><ul><li>Argentina </li></ul><ul><li> United Kingdom </li></ul><ul><li>Japan </li></ul><ul><li>Canada </li></ul><ul><li>China </li></ul><ul><li>South Korea </li></ul>Pankaj Muthe
  27. 27. FRANCE <ul><li>Titled as the world's largest wine producer many times . </li></ul><ul><li>France leads the world in per capita consumption of wine </li></ul><ul><li>French exports represent more than 30 percent of total French production </li></ul><ul><li>French imports consist of bulk table wine </li></ul>Pankaj Muthe
  28. 28. ITALY <ul><li>Destinations for italian wine were germany (38 percent), france (23 percent), and the united states (8 percent) in volume terms. </li></ul><ul><li>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 </li></ul>Pankaj Muthe
  29. 29. AUSTRALIA <ul><li>Exceptional advancements in both wine industry growth and international marketing have made that country the envy of other export-minded nations </li></ul><ul><li>Formation of the Wine Vision Group </li></ul><ul><li>Australian Wine Research Institute and Grape and Wine Research and Development Corporation are leaders in such fields of study </li></ul>Pankaj Muthe
  30. 30. SPAIN <ul><li>Spain's vineyard acreage is the largest in the world </li></ul><ul><li>Total Spanish wine production ranks only third behind France and Italy. </li></ul>Pankaj Muthe
  31. 31. CHILE <ul><li>More than 60 percent of Chilean wine now goes to overseas markets, including India - the highest national wine export level in the world. </li></ul><ul><li>Despite being only the 9 th largest producer, Chile had 3.5% of the total export market and was ranked 6th in the world. </li></ul>Pankaj Muthe
  32. 32. USA <ul><li>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 </li></ul><ul><li>Markets are targeted under the Market Access Program (MAP) </li></ul>Pankaj Muthe
  33. 33. USA <ul><li>U.S. Wine Exports to Japan Rebound </li></ul><ul><li>New Markets Continue to Grow </li></ul><ul><li>U.S. Wine Imports Continue to Grow </li></ul><ul><li>Grapes of wealth for the US wine market </li></ul><ul><li>Red wines outsell whites in the US </li></ul><ul><li>U.S. wine export revenue up 28% in 2004 </li></ul><ul><li>Napa Wine worth $9.5 billion </li></ul><ul><li>International challenges facing U.S. wine industry </li></ul><ul><li>Competition To Intensify </li></ul><ul><li>Trade Issues </li></ul><ul><li>U.S. Government Programs </li></ul>Pankaj Muthe
  34. 34. SOUTH AFRICA <ul><li>Good to excellent soil and climatic areas for additional vineyard development . </li></ul><ul><li>Recent U.S. studies on the South African wine industry conclude s tha t </li></ul><ul><ul><li>Good time for those interested in establishing long-term business relationships </li></ul></ul><ul><ul><li>With growth potentials to get into the market and start building up a consumer base and brand image. </li></ul></ul>Pankaj Muthe
  35. 35. ARGENTINA <ul><li>Argentina has developed several organizations to help boost the quality of the wines with the intent of increasing their presence in the export market </li></ul><ul><li>5 th largest producer of wine in the world </li></ul><ul><li>10 th position in the total export market in the world </li></ul>Pankaj Muthe
  36. 36. UNITED KINGDOM <ul><li>&quot;Crucible&quot; for the global wine market </li></ul><ul><li>British import market was second only to the German market </li></ul>Pankaj Muthe
  37. 37. JAPAN <ul><li>Steady increase in the size of its imported wine market . </li></ul>Pankaj Muthe
  38. 38. CANADA <ul><li>More governmental constraints to competition in Canada </li></ul>Pankaj Muthe
  39. 39. SOUTH KOREA <ul><li>Competition strong for South Korea's robust wine market </li></ul><ul><li>The market is still developing </li></ul><ul><li>Rules of the Road </li></ul>Pankaj Muthe
  40. 40. CHINA <ul><li>Increased market opportunities . </li></ul><ul><li>China's entrance into World Trade Organization </li></ul>Pankaj Muthe
  41. 41. STRATEGIES FOR EXPORTS <ul><li>High Delivery Costs Erode Advantage of Low Cost Production </li></ul><ul><ul><li>Improvement in Logistics </li></ul></ul><ul><ul><li>Investment in Supply Chain Infrastructure </li></ul></ul><ul><ul><li>Negotiating better freight rates with advance shipping schedules </li></ul></ul><ul><li>Develop Brand INDIA </li></ul>Pankaj Muthe
  42. 42. THANK YOU !!! Pankaj Muthe <ul><li>Pankaj Muthe </li></ul><ul><li> </li></ul><ul><li>[email_address] </li></ul><ul><li>+91-9822501850 </li></ul>