The UK wine market shrank last year after more than a decade’s growth and is not expected to recover in volume terms until 2011, according to a new report.
Wine UK 2009 from research firm Mintel shows that UK wine sales by volume actually shrank 2% last year to 1.162 billion litres.
UK wine sales by growth have grown steadily since 1995 but a trend towards healthy lifestyles and heavy Government taxation (duty on wine increased 17% in 2008) appears to have taken its toll.
The value of the UK wine market also dropped 1% year-on-year in 2008 to stand at £9.6b.
With rising production costs and the strength of the Euro against Sterling, Mintel forecasts that the wine market will not recover in volume terms until 2011.
After this volumes will increase 4% up to 2014 to reach 1.18 billion litres.
Mintel said it was more important than ever that the wine industry engages more with younger consumers – and amongst the 25 to 34 age group in particular – to gain market share and loyalty for future consumption.
“One people join the wine “club” they tend to stay in it for life,” said Jonny Forsyth, senior drinks analysts at Mintel.
“The problem for industry is getting people to join earlier. Despite being big drinkers generally, 25 to 34 year olds are below average drinkers of wine. With wine seeing its first decline in volume and value for some time in 2008, it is increasingly important to target younger consumers effectively.”