Austria: Wine now scarce and costly

Nevertheless, the atmosphere at the annual press conference of Austria's Wine Marketing in Vienna was rather positive. After all, the decline in yield was sort of hoped for, since it focuses on the bulk wine market, which is not very popular among strategists of Austrian wine.

Apparently, a price reduction as it was seen in stron-selling years could not be expected. Part of the wines are now sold for about 50 percent more than a couple of months ago. The scarce amount that has influenced the prices of wines will undoubtedly have an impact on export numbers in 2011.

Austria saw itself once more on the way up to success in 2010. Granted, export numbers declined by a total of 13.7 percent to a total of 60 million liters, however, a new record was reached with an export value of 122 million euro (plus 2.6 percent). "The export share of bottled wines increased to 91 percent, which demonstrates an essential development for the domestic market", says Willi Klinger, director of Wein Marketing. Thus, the average price for Austrian wine is slightly more than 2 euro/liter.

These numbers - as usual internationally - are strictly for winery sale prices. The fact that this purchase price is not significantly higher despite the international boom of Austrian wines, - which has been praised by the media quite a bit - is mainly the fault of Germany! There, the average is only 1.54 euro. The only export country that is somewhat important to Austria due to its low prices as well, is the Czech Republic (only 0.83€). Quite the opposite for countries like Switzerland (4.35€),  the United States (4.09 €) as well as the Netherlands (3,61 €), who follow up right after Germany in Austria's export statistics. Since Germany is Austria's most important importing country with almost 50 million liters, German numbers are putting a damper on the average balance.

Those who have only been paying close attention to the numerous specialist retailers who work with Austrian wine in Germany, cannot believe what's happening. You need to realize that (a) the many small wine importing German tourists are not included in the official numbers and (b) about a third of the wine that is exported to Germany is cheap stock and ultimately sold at the discounter for significantly less than 2 euro/liter.

Austrian marketing strategists who are really proud of the image of their wines, don't like talking about things like "liter-bottles for 1.49 euro". That is why Gerhard Wohlmuth, chairman of the wine and spirits store of Austira's chamber of commerce and current chairman of the board for Austria's Wein Marketing, says: "This is the perfect moment for us to position our wines in higher price segments, after all, we do not allow the production of cheap wines".

Nature already did its part in 2010 to make sure that the share of open wines in total exports declined drastically in comparison with the previous years. In 2009 it was still more than 30 million liters (bottled wine a little over 39 million liters). For 2010 the numbers should be 43 million liter bottles compared with 17 million liter bulk wines (average price 0.65 €). The export success is shared by numerous wineries. "Approximately 700 producers have good export numbers", prospects Viticulture President Josef Pleil. About half of them will be guests at the upcoming ProWein in Duesseldorf late March. Some vintners might even bring this year's first  Icewine. Plenty of that could be found there, just like in Germany, in early December.

To what extent the Austrian Wein Marketing can influence sales increases will be an unanswered question for a while. The budget will be a little smaller in 20111, however. The nation's funds were reduced. Trade wineries, whose funds depend on sold amounts, will pay less since they can hardly sell more themselves. That is why Austria is trying to come up with a new structure, in which dealers who benefit greatly from Wein Marketing will be put under more pressure.(r.knoll)