Not even the most efficient crystal ball could predict how wine imports would behave in the first six months of 2020. With more than half of the year under the quarantine’s effects, the import of wines and sparkling wines has grown consistently. The imports into Brazil have grown 7.4% in volume and have decreased 3% in value (a total of USD 153 million) when compared to the same period of 2019.
A total of 5.9 million of 9-liter boxes, aprox. 71.3 million 750ml bottles, have legally entered Brazil, including wines and sparkling wines, whilst in 2019, 5.5 million boxes where imported. In the analysis by categories, the import of wines registered the most significant increase, of 7.8%. The volume went from 5.3 million boxes of 9 liters to 5.7 million boxes of 9 liters.
The import volume of sparkling wines and proseccos haven’t changed much, with an increase of 0.6%. A total of 184,600 boxes of 9 liters entered Brazil in the first half of 2019, and 185,700 9l boxes entered Brazil in the same period of 2020.
Champagne is the category that has suffered the most, with a volume drop of 34.9%. In the first semester of 2020, 12,500 9l boxes where imported into Brazil, while in the same period of 2019, a total of 19,200 boxes of 9l entered Brazil.
Focusing on value, in FOB dollars, the reduction in the semester was of 37.5% for champagnes; 9.9% for sparkling wines, and 1.7% for wines.
If we analyze only the month of June when the sector was already used to the pandemic and the new consumers’behaviour, all categories – champagnes, wines, and sparkling wines – have registered a volume increase in comparison to June of the last year.
– Champagne: increase of 4.5% (1,700 boxes in June 2019 and 1,800 boxes in June 2020) ;
– Sparkling wines: increase of 3% (29,400 boxes in June 2019 and 30,300 boxes in June 2020);
– Wines: increase of 21.2% (940,200 boxes in June 2019 and 1.2million boxes in June 2020).
This import increase tends to indicate that importers’ inventories have decreased significantly, leading to purchases and internalization of bottles, despite the big devaluation of Brazilian Reais in comparison to US Dollar. A first possible and still preliminary analysis demonstrates that the in-house consumption is offsetting the on-trade sales, which shows an advantage for companies which are managing to operate in multi-platform sales channels, with great relevance in e-commerces and deliveries.
The drop of 3% in value recorded in dollars, in comparison with the first half of 2019, indicates that importers are betting on cheaper wines. The average value of the box with 9 liters of wine in the first semester of 2020 was US $ 25.7 (FOB), against the US $ 28.4 in the same period last year.
By going deeper int price ranges, it is possible to confirm this trend. Only those labels with lower FOB value registered an increase in imports.
FOB prices by range
Up to USD 19.99: increase of 24.1%;
From USD 20 to USD 29.99: increase of 9.7%;
Other price ranges have a drecrease in volume imported.
Chile continues to lead the market in this first semester. The labels of the Andean country represent 42.4% of the market of wines imported into Brazil. The volume of Chilean sales grew 10.1% in volume, despite having registered a 5.2% reduction in value. Portugal, which has been consolidating in second place with 16.8% of the market, had an increase of 17.2% in volume and 18.6% in value in this first semester, always in comparison with the previous year. Argentina, which occupies the third place, with 15% of the market, had an increase in volume of 5.3%, but a decrease of 2.5% in value. The second semester is traditionally the period with more imports and higher consumption. And if this trend continues, this shall be quite an year for the industry.