Imported Wine Grows, Beer Struggles

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Imported wine is again up, but things continue to be rough for beer.

According to wine research firm Gomberg, Fredrikson & Associates, total wine shipments in the US expanded 3% to 399 million cases in 2016.

The growth is consistent with 10-year trends and is across both domestic and imported wines. Over the past 10 years, the growth of the wine industry has outperformed the other beverage alcohol categories, the firm reports.

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In retail terms, trends for wines priced under $10 are flat, while wines over $10 are trending up at rates between high single digits to low double digits. The overall volume of wine in food stores is up 1.2 million cases, with only 100,000 cases of this growth coming from wines under $10.

Despite the strong US dollar, imported bottled table wine growth slowed in 2016. US bottled export volume was down in 2016, although value was up.

The Gomberg-Fredrikson report monitors monthly and annual comparative shipments of leading California wineries and wine imports by country. The report provides market intelligence for the wine industry, and includes shipment volumes for all major producers and commentary on the current month's developments.

While wine had another good year, 2017 isn’t off to a very good start for beer. US beer volume sales declined 1.2% through the first 50 days of the year, according to recent data from market research firm IRI Worldwide.

Like the Gomberg-Frederikson report, off-premise trends are the source for the IRI data, but they provide a handy guide to mass market trends in that channel that can be useful on-premise. The company said total beer dollar sales were up just 0.1% through February 19 in its multi-outlet and convenience (MULC) store universe (which includes grocery, drug, Wal-Mart, club, dollar, mass-merchandiser, and military stores).

Market research firm Nielsen also reported similar beer category trends this week, highlighting 1.3% volume sales declines over the last quarter.

Volume sales of craft beer slowed as well, only up 1.6%, according to IRI. Sierra Nevada and Boston Beer Company struggled through the first part of 2017 with volume down 11.4% and 7%, respectively.

Up were Lagunitas (up 13.7%), Stone Brewing (up 18.5%) Bell's Brewery (up 26.7%), Firestone Walker (up 27.8%) and Founders Brewing (up 42 percent).

In more bad news for beer, the craft beer geared website Brewbound reported that wine and marijuana are taking market share from the craft beer category. Beer's dollar share declined 0.3% to 49.2% last year, with wine taking 32.9& of beer industry revenue and marijuana 7.1 percent. About 40% of adults would buy marijuana were it legal in their state, and 82% said they would stop drinking beer altogether if marijuana was available legally.

Wine is growing as a threat to beer as more states legalize wine sales outside of liquor stores, with wine and spirit sales outpacing beer for the second year in a row in multi-channel outlets excluding c-stores.

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