Foreign sales of Rioja Alavesa wines sustained in 2022 thanks to price increases
- An interesting evolution of markets is taking place, as sales are shifting from Europe to North America, with a huge increase in the US, Canada and Mexico
- After overcoming the pandemic crisis and recording historic records in 2021, the world wine trade has encountered a year of great uncertainty
- The Basque Government awards annual grants for the promotion of wine products, which have benefited 184 companies since 2018 and led to investments of 115 million euros
The Minister for Economic Development, Sustainability and the Environment, Arantxa Tapia, together with the Deputy Minister for Agriculture, Fisheries and Food Policy, Bittor Oroz, took part in the Uztaberri Eguna events, a traditional day on which winemakers open their doors to present the young wines from the last harvest. Throughout the morning, they visited wineries and gastronomic stands, and provided information on the evolution of wine exports over the past year.
“Following the trend in the world wine trade in a period of great uncertainty and high inflation,” said Tapia in Lapuebla de Labarca, “Alava’s exports of DOCa Rioja wines fell by 16.9 percent in volume, but held up well in value (-2.6%), thanks to an average price that now stands at 6.92 euros per litre, more than one euro per litre higher than that recorded in the same period in 2021.”
In fact, in fourteen of the top fifteen markets, all but France, the price rose sharply. Interestingly, sales are shifting from Europe to North America, with a huge rise in the US, Canada and Mexico, and a notable fall in the UK, Switzerland, Germany, Ireland, Sweden, Norway, and the Netherlands...
Foreign sales of DOCa Rioja wine from Álava were close to 21.2 million litres, at an average price 18.6% higher than in 2021, which has resulted in barely any reduction in turnover, which reached 146.7 million euros. By variety, whites fell more than reds and rosés in volume, although they generated slightly more turnover, as their average price soared. Overall, Alava’s exports of DOCa Rioja wine accounted for 49% of the volume and 68% of the total value of wine exported by the Basque Country in these 11 months.
Alava exported DOCa Rioja wine to a total of 97 world markets between January and November 2022. The United Kingdom largely marked the global decline, although it is once again the leading market in terms of volume. The United States grew at an excellent pace and moved up from fourth to second place, overtaking Switzerland and Germany. The US grew even more in value terms, to become the leading market, overtaking the UK and Switzerland, which recorded sharp falls. Mexico stood at €7.66/litre, 3 euros higher than the UK market.
This remarkable growth in the United States, together with that recorded in Canada and Mexico, confirms the great momentum of Alavesa exports of DOCa Rioja wines in North America. Thus, there has been an exceptional increase in sales to the Dominican Republic, Colombia, Australia and the United Arab Emirates, markets that do not yet account for a large share of the total, but which have very good prospects.
After overcoming the crisis resulting from the COVID-19 pandemic and recording historic records in 2021, the world wine trade, which was set to consolidate this growth in 2022, has encountered a year of great uncertainty. Russia’s military invasion of Ukraine, the transport and material supply crisis and the sharp rise in energy and fuel prices have led to a high level of global inflation. World wine exports are losing volume, but gaining turnover, due to very high prices. Alava’s exports of DOCa Rioja wines are following this trend, although prices had already been rising in the years prior to the pandemic, in a clear strategy to generate added value.
Various lines of support
With a view to positioning Basque wines in this complicated global situation, the Basque Government offers companies various lines of promotional and financial support, mostly coordinated through the Basque Wine Office, which provides comprehensive support and reinforces the strategy that the wineries of Rioja Alavesa and the three Txakoli Designations are carrying out both in the domestic and national markets and internationally.
This office provides technical and business advice, facilitates training, innovation and research and works on internationalisation from all angles. Through it, the Basque Government is activating various measures to tackle the difficulties of the international market, such as greater support for participation in fairs, organisation of trade missions, etc., with the aim of showing the world the commitment to differentiation and quality that Basque wineries are making, promoting and supporting this way of doing things as their calling card.
As far as financial support is concerned, the Basque Government annually announces aid for the promotion and communication of wine products in third countries, aimed both at wines covered by a designation of origin or a protected geographical indication, as well as those in which the grape variety or varieties are indicated. Since 2018, a total of 184 companies have benefited from this funding, and investments have approached 115 million, of which around 55 million have come from the grant.
The Basque Government has also recently opened the call for applications for aid for the year 2023 to finance tangible and intangible investments in processing facilities and wine infrastructures, as well as in structures and marketing tools in this sector. The aid will cover between 25% and 50% of the expenses presented, and will be direct non-refundable. In previous calls for proposals, the expenditure presented has been around ten million euros, so a similar figure is expected for this one, both in terms of investment and the corresponding aid.