Global Organic Wine Market - 2021-2028
Organic wine is wine made from grapes grown according to organic farming principles, which typically excludes the use of artificial chemical fertilizers, pesticides, fungicides, and herbicides. Production of organic wine witnessed an annual growth of over 20% in 2019 and 2020, which is significantly higher than that of conventional wine. There is an estimated 1500-2000 organic wine producers globally, with more than 885 organic domains in France alone. The legal definition of organic wine varies from country to country. The primary difference in how organic wine is defined relates to the use of preservatives, specifically sulfur (sulfur dioxide, sulfites, SO2) during the winemaking process. In the US, no additional sulfites may be added to any organic product, including wine. In the EU, added sulfites are allowed in organic wine and determined by the kind of wine. The difference in the standards between the US and Europe is the additional label "Made with Organic Grapes." The global Organic Wine market valued USD XX million in 2020 and is estimated to reach USD XX million by 2028, growing at a CAGR of xx%.
Ethical food consumption has been on the rise lately in most developed countries. This recent shift in postmodern consumerism may be explained from various angles, such as the growing health-seeking niche market, the symbol of elevated social and economic status, and the growing number of people who fear the wide-ranging consequences of food and beverages have on the micro and macro environment. French paradox claims that moderate consumption of red wine might benefit people's well-being and is being re-interpreted in a more 'natural' way among those health-concerned consumers. Moreover, organic wines strive to limit the chemical components that go into the wine. As a result, organic certification organizations ban herbicides and pesticides throughout the entire wine production process. Organic wines protect families across the globe. In the event families or towns are located near a winery, the application of pesticides means an opportunity for them to leach into the water supply, food supply, and more. That can cause serious health damage at every level, but organic wines never use chemical-laden pesticides, making them far safer for nearby families and the farmworkers themselves. The organic wine category has been growing for several years: but as consumers become more concerned about what they eat and drink, there's now a real sense of acceleration in the category
Organic wine is a niche segment in the global wine industry, accounting for around 3.6% of total wine consumption. But with more than 1 billion bottles of organic wine set to be consumed around the world every year by 2022, it is gaining market share in the industry. For wine producers, the interest in organic comes from two directions. Between 2018 and 2019, the sales value of organic wine experienced significant growth. In particular, the selling of D.C.O. and D.C.G.O wine grew from 5.8 million euros to 7 million euros. The certification D.C.O. stands for Denomination of Controlled Origin, whereas D.C.G.O. means Denomination of Controlled and Guaranteed Origin. The sales value of fortified wine went from 43 thousand euros to 500 thousand euros. Italy is the world's leading organic wine producer. The country produced 440 million bottles of organic wine in 2013, and it is estimated that the volume will reach 990 million bottles by 2023.
The cost of organic viticulture is usually higher than most conventionally managed vineyards, typically making the wines more expensive as a result. Due to the lack of protective sprays, extremely poor weather and unexpected fungal diseases or pests can badly damage a crop for the year. This is why warm and dry regions tend to have more organic viticulture and why wet, colder regions often can't take the risk. The certification process can be costly, so many smaller producers manage their vineyards in an organic process. They won't be able to use the symbols on the labels to indicate this. Legally, no laws are regulating which wines can be labeled "natural." This means that any company could call their wine natural without regard for the process. To make sure that the wine was produced naturally, try to purchase bottles labeled as organic or biodynamic. There are specific laws regarding what makes a product organic. This labeling allows the consumer to know more about the ingredients and increases the chance of being natural.
By type, the market is segmented into Red Organic Wine and White Organic Wine. By packaging, the market is segmented into Plastic Bottles, Aluminum bottles, Glass Bottles, Cans, Tetra Pak and others. By distribution channel, the market is segmented into Supermarket, Specialty Stores, Online platforms, Bars, Restaurants and Hotels.
In recent years, moves have been made to replace glass, which, while being excellent at protecting wine from the ingress of oxygen, is heavy and tends to break. There has been a shift to bag-in-box for cheaper wines and more radical options such as Tetrapak and cans. The latest development in the packaging of wine is the appearance of 75 cl (standard sized) PET bottles on supermarket shelves. Two wines, a New Zealand Sauvignon Blanc and an Australian Shiraz Rose, have been launched by UK supermarket Sainsbury's in PET. Later, Aussie producer Wolf Blass launched two of its Green Label wines in PET. The main driving force behind the adoption of PET is an environmental one, and it has to do with the weight of the bottles, which reduces their carbon footprint through savings in the transport chain. The UK consumes around 1 billion bottles of wine each year, and estimates are that reducing the bottles for all these to the lightest available would save around 90 000 tons of CO2. If this is coupled to bottling in the UK, with the bulk shipment of the wine, the savings are magnified because around twice the volume of wine can be shipped in bulk per container.
Europe is the largest consumer of organic wine, with Germany, France and the U.K. together holding over 30% of the global consumption volume in 2020. France alone reported a net sales generated at nearly USD 1.2 billion. The high consumer interest for organic wine and large production led to the growth of organic wine market in Europe. Spain, Italy and France accounted for 26%, 25% and 19% of the global production volume in 2020. Spain has seen the area dedicated to organic vineyards grow 522% over the last ten years. In Germany, organic wine accounted for 6% of still wine consumption in the country in 2017, with locally produced German wine representing approximately 52% of that volume. France - a country where the organic food sector has taken off in recent years - is seeing a mirroring boom in the organic wine sector. The turnover for the sector has leaped up, with an increased number of vineyards converting to organic and more sustained demand from consumers both at home and abroad. In 2016, 87 new vineyards turned to organic practices and the number rose to 572 in 2017
The organic wine market is moderately competitive with the presence of local as well as global companies. Some of the key players contributing to the growth of the market include The Organic Wine Company, The Wine Cellar Group, King Estate Winery, Dry Farm Wines, Mount Avoca, Organic Wine, Vintage Roots, Tamburlaine Organic Wines, Frey Vineyards and Elgin Ridge Wines among others. In addition, the major players are adopting several growth strategies such as product launches, acquisitions, and collaborations, which contribute to the growth of the organic wine market globally.
COVID-19 had a negative impact on the global organic wine market, causing significant decline in consumption volume and sales revenue across most of the countries. The closure of foodservice industry, HoReCas, bars and restaurants owing to lockdown restrictions led to lower wine consumption volume. Social restrictions measures around the world have impacted the demand and the production of wine. Nearly 20% of wineries stopped production and anticipated a 75% decrease in sales in April 2020. With the production of 2020's wine supply in progress, the situation also heavily impacts the existing product stocks of the winemakers looking to sell the wine reserves of 2018. However, due to the recently applied state measures, the biggest wine-producing countries - Italy, France, Spain, and the US - have steadily seen sales decline.