The World’s Wine Markets

The World’s Wine Markets

Globalization at Work

Edited by Kym Anderson

This absorbing book examines the period of massive structural adjustment taking place in the wine industry. For many centuries wine was very much a European product. While that is still the case today – three-quarters of world wine production, consumption and trade involve Europe and most of the rest involves just a handful of New World countries settled by Europeans – the importance of exports from non-European countries has risen dramatically over the past decade.

Chapter 1: Introduction

Kym Anderson, David Norman and Glyn Wittwer

Subjects: economics and finance, industrial economics, international economics


* Kym Anderson Why does the wine industry attract so much attention? After all, it accounts for just 0.4 per cent of global household consumption, and vines cover only 0.5 per cent of the world’s cropland (of which barely one-third produce wine grapes). Moreover, globally it is not a growth industry in that world wine production has been declining slightly over the past two decades. But to millions of investors and hundreds of millions of consumers, this industry provides a far more fascinating product than its shares of GDP or global expenditure might suggest. More than that, it provides an intriguing case study of globalization at work: since the late 1980s the share of wine production that is traded internationally has nearly doubled, there has been a surge of foreign investment and mergers and takeovers in the industry, and the phenomenon of ‘flying winemakers’ has emerged as viticulturalists and oenologists seek to widen their experience, particularly by changing hemispheres in their offseason. Wine’s globalization has brought major economic gains to participants in the expanding countries, but pain to many traditional producers. In the past 30 years, wine producers in France, Italy, Portugal and Spain have watched per capita consumption halve in their domestic markets, so they have received low prices despite having reduced their combined grapevine area from 5 million hectares in the late 1960s to 4 million in the late 1980s and to barely 3 million today. For those growers it adds insult to injury to see wines from New...