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28 July 2021

Market focus: Switzerland

Denis Pantini - Vinitaly-Nomisma Wine Monitor Observatory

Switzerland is one of the few markets that did not see falls in wine imports even during the most critical year of the pandemic (2020). Last year, in fact, purchases of imported wines in Switzerland were worth almost 1.1 billion euros on over 1.8 million hectolitres, i.e. 0.5% more in value and 2.5% by volume compared to the previous year. It should also be noted that the advantages of Switzerland for Italian producers lie in being a "constant" market as well close from a geographical point of view.

Wine consumption in this market has stood for many years at around 2.6 million hectolitres and consequently imports have not seen particular variations (Switzerland itself produces about 148 million bottles of wine per year). During the decade 2009-2019 (i.e. before the advent of the coronavirus), the average annual compound rate for international wine imports was +2.5% in volume and +5.4% in value; in Switzerland, these changes were respectively -0.4% and +4%, highlighting slower and less volatile trends.

On the other hand, minimal unemployment and per capita income among the highest in the world are significant factors of appeal for wine producers. The fact that Switzerland, among the top 10 import markets, has the highest average price for imported bottled wines (still and sparkling) further emphasizes this important opportunity: 8.4 euros/litre compared to 6 euros in the United States or 3.5 euros in Germany. All this takes place within a distribution context where most purchases are made through modern retail distribution points of sale (less than 15% of volumes consumed pass through on-trade).

Even the first half of 2021 (Table 1) reflects this “assurance” of continuity for wine purchases by Swiss importers. Data show an increase compared to the same period in the previous year of 28% in value and 10% in volume; this positive result was even higher than the first half of 2019, when there was not even a hint of the coronavirus.

Looking at the top five suppliers on the Swiss market, it clearly emerges that the country's wine trade is configured as an exclusively European business. France dominated the first half of this year with a growth of 40%, overtaking Italian wines (that until last year were the market leader) with an albeit excellent performance of "only" 19 %. This result was slightly bettered by Spain (21%), ranking in third place but way behind the absolute value of Italian exports.

The recovery achieved by France (imports of French wines into Switzerland dropped by 6% in 2020) is across the board, in that it involved all categories of imported wine: +58% for sparkling wines, +43% for still wines, +85% for bag in box and even +21% for bulk wines, an area where French wines do not usually figure among market leaders.

As for Italy - having achieved growth in 2020 quite the opposite to that posted by France, i.e. 6% compared to 2019 - the first half of 2021 saw significant increases in line with the average for all categories, with still bottled wines posting an increase of 20% and sparkling wines just behind at 17%.

This growth in imports is also influenced in terms of value by the progressive re-opening of the on-trade channel (bars and restaurants), which can be deduced from the recovery in average prices of imported wines which in 2020 (in the wake of the blockade imposed on the Horeca sector) saw an average setback - for still wines - of almost 9%.

The first half of 2021, on the other hand, highlights an increase in prices in the same category of almost 10%, with imported French wines at +13% and Italian wines at +9%.


Wine imports into Switzerland by origin in the first half-year 2021 and variation compared to the same period in 2020

 

 

 

Photo by Xavier von Erlach on Unplash