IWA+Report+2016_FA

Irish
WINE
MARKET
2016

About th e I rish Wine Association (IWA)
The IWA represents wine distributors and importers in Ireland and is part of the Alcohol Beverage Federation of Ireland (ABFI). We
promote the economic contribution of the wine industry and advocate on issues that affect our industry. We liaise with relevant stakeholders
to create a more sustainable business environment for our members, as well as providing members with access to industry
information and an opportunity to share best practice.
Our M em bers
Th e I rish Wine Association is a business sector within I bec
Ibec is the national voice of business in Ireland. Ibec represents the interests of business in Ireland and provides a wide range of direct
services to its 7,500 member companies.
I bec vision:
Ibec – The most influential, dynamic business representative organisation in Ireland, driving our business agenda in Europe.
I bec m ission:
Ibec – Leading, shaping and promoting business policy and conditions to drive economic success.

CHAIRMAN'S STATEMENT
A Snapshot: I relan ds wine industry
Ireland’s wine industry is facing uncertainty. In the context of Brexit, the fact that Ireland
shares a land border with the UK will have serious trade implications for the wine
sector. The uncertainty around the Brexit negotiations has resulted in the falling value
of Sterling which is likely to drive cross-border shopping and has already seen a fall in
the number of British tourists visiting Ireland.
I welcome the fact that the Government did not raise the rate of excise on wine in
Budget 2017. I would hope that the Government continues acknowledge the role that
the drinks industry plays in the hospitality sector and seriously considers an excise
decrease on wine in Budget 2018.
Despite this uncertainty, the wine industry has seen a marginal increase in consumption
and it continues to employ over 1,100 people directly while supporting thousands of
other jobs in Ireland’s the 13,000 restaurants, pubs, independent off licences and hotels
that sell wine. In 2016 sales of 9 litre cases increased to just over 9 million, up from 8.56
million cases in 2015. The market share for wine increased slightly from 27.7% in 2015
to 27.8% in 2016. The increase in total sales can be attributed to Ireland’s economy
performing well in 2016, with unemployment falling, wages increasing marginally and
household disposable income going up. In 2016 Ireland had the fastest growing
economy in the EU for the third consecutive year and I hope that we retain that title
for a fourth consecutive year in 2017.
Irish consumers continue to pay the highest rate of excise on wine in the EU and since
2012 the Government has subjected the sector to penal excise increases of 62%. In
2016, the sector paid €380 million in excise to the Exchequer, an increase of €25
million from the previous year. While 14 EU counties pay no excise on wine, the excise
rate in Ireland equates to €3.19 for a €9 bottle. This is 64 cent more expensive than
Finland, the second most expensive country in the EU.
In light of this stark reality, it is imperative that the Government decrease the rate of
excise on wine in order to alleviate the risks associated with the impact of Brexit. The
benefits of an excise decrease will not only benefit consumers but it will protect and
create jobs in the tourism, retail and hospitality trade.
Jobs
Sales i n I relan d
Excise recei pts
Consumpti on
% tax i n a stan dard
€9 bottle
WINE PRICES
Taxation cost
per 1000 CASES
Ireland excise
rate ranking in EU
1,100 directly emplyed by distributers and
importers. Thousands more in 13,000
restaurants, independent off-licences and
hotesl that sell wine.
9 million cases
€380 million
17.1 litres average table wine consumption
per capita in 2016 versus 16.44 litres
average consumption per capita in 2015
54%
86.8% of wine purchased in Ireland is
between €7 - €10.99
€38,240
1- Highest in EU
Jim Bradley
Chairman of the Irish Wine Association

Wine Sales 2015
Total wine sales 1950-2016 (millions of cases)
Year 1950
Sales,
millions 0.2
of cases
1960
0.3
1970
0.6
1980
1.3
1990
1.7
2000
4.8
2010
8.7
2011
9
2012
8.9
2013
8.2
2014
8.5
2015
8.5
2016
9
Source: Irish Revenue Commissioners Clearances data, December 2016
Wine consumpti on breakdown
Red / White / Rose
Red White Rose
2003 52% 45% 3%
2004 49% 47% 4%
2005 50% 46% 4%
2006 51% 51% 5%
2007 51% 51% 5%
2008 50% 45% 5%
2009 50% 45% 5%
2010 47% 49% 4%
2011 46% 50% 4%
2012 46% 50% 4%
2013 45% 51% 4%
2014 47% 50% 3%
2015 47% 50% 3%
2016 47% 50% 3%
RED
47%
Male/female (volume share)
MALE
45%
FEMALE
55%
Source:
TGI Data 2016
Age breakdown (volue share) 2016
5%
Male Female
2006 43% 57%
2007 43% 57%
2008 43% 57%
2009 43% 57%
2010 45% 55%
2011 45% 55%
2012 40% 59%
2013 43% 57%
2014 43% 57%
2015 39% 61%
2015 45% 55%
16% 22% 21% 17% 19%
ROSE
3%
Source: Industry Sources 2016
WH ITE
50%
MALE
FEMALE
Source:
TGI Data 2016
18-24 25-34 35-44 45-54 55-64 65+
9% 16% 20% 19% 16% 20%

ALCOHOL CONSUMPTION BY CATEGO RY M IX
Alcohol beverage market 2016 (% total volume)
Wine categories (% volume share)
H IGH
STRENGTH
0.1%
LOW
STRENGTH
1.2%
SPARKLI NG
2.4%
BEER
2006- 51%
2016- 46.2%
WINE
2006-21%
2016- 27.8%
SPIRITS
2006-20%
2016- 19.2%
CIDER
2006-8%
2016- 6.8%
TABLE
WINE
96.3%
Source; Irish Revenue Commissioners Clearance Data
Excise receipts on alcohol (€m)
Source; Irish Revenue Commissioners Clearance Data
BEER WINE SPIRITS CIDER
WINE AS %
Off trade distribution channels 2016
2010
2011
2012
320
307
308
210
231
231
244
247
284
44
44
43
25.7%
27.9%
26.7%
OTH ERS
8%
2013
358
302
290
52
30.1%
2014
425
355
302
58.5
31.1%
2015 417 355 311 53.8 31.2%
2016 430 380 338 59 31.5%
Source; Revenue Commissioners
Wine distribution channels 2016
DISCOUNTERS
21%
M U Lti pLES
50%
Share of Total Market
Off-Licences
On Trade 21%
79%
Source : AC Nielsen Dec 16 & IWA member company estimates
INDEPEN DENTS
10%
SYM BO L GROUPS
11%
Source: Nielsen MAT Dec '16. (Includes Dunnes Stores & discounter estimate)

Country of origin
25.6%
17.7%
12.9%
12.3%
9.7%
7%
5.6%
3.8%
2.8%
0.8% 1.6%
Chile Australia France Spain Italy U.S.A N.Zealand S.Africa Argentina Germany All Others
Country of Origin Sales and Market Shares for Table Wines
Ran ki ng
Cases
2000
Cases
2012
Cases
2013
Cases
2014
Cases
2015
Cases
2016
Market
SHARES
%2000
Market
SHARES
%2012
Market
SHARES
%2013
Market
SHARES
%2014
Market
SHARES
%2015
Market
SHARES
%2016
Australia 750,000 2,079,500 1,693,235 1,584,192 1,548,308 1,596,180 16.7% 24% 20.6% 18.6% 18.1% 17.7%
Chile 669,000 1,819,500 1,652,137 1,998,548 2,166,955 2,308,600 14.9% 21% 20.1% 23.5% 25.3% 25.6%
France 1,043,000 1,213,000 1,249,377 1,248,059 1,199,105 1,163,318 23% 14% 15.2% 14.7% 14.0% 12.9%
United States 632,000 866,450 715,104 672,061 616,683 631,258 14.1% 10% 8.7% 7.9% 7.2% 7%
South Africa 332,000 346,570 369,881 395,378 376,862 342,683 7.4% 4% 4.5% 4.6% 4.4% 3.8%
Spain 257,000 866,430 920,594 1,005,655 1,012,877 1,109,210 5.7% 10% 11.2% 11.8% 11.8% 12.3%
Italy 386,000 866,430 937,033 869,657 813,679 874,743 8.9% 10% 11.4% 10.2% 9.5% 9.7%
Germany 118,000 86,640 98,635 95,090 77,085 72,864 2.6% 1% 1.2% 1.1% 0.9% 0.8%
New Zealand 41,000 346,570 320,564 338,314 425,913 505,006 0.9% 4% 3.9% 4.0% 5.0% 5.6%
Argentina 96,000 86,640 172,611 192,796 196,308 252,403 2.2% 1% 2.1% 2.3% 2.3% 2.8%
All others 160,000 86,640 90,415 115,596 131,559 161,705 2.9% 1% 1.1% 1.4% 1.5% 1.6%
Total
Table Wine
Eu rope
Rest of World
4,484,000 8,664,370 8,219,587 8,515,344 8,565,038 9,017,970 100% 100% 100% 100% 100.0% 100.0%
1,946,000 2,772,598 3,238,517 3,334,057 3,207,993 3,256,107 43.4% 32% 39% 39.2% 37.5% 36.2%
2,538,000 5,891,772 4,981,070 5,181,287 5,357,045 5,761,863 56.6% 68% 61% 60.8% 62.5% 63.8%
* The figures for 2016 are based on official trade statistics, IWA Country of Origin Survey, AC Nielsen and other trade sources.

Vo lume share by price po i nt
Total wine
Volu m e Share
€14 plus
€13-13.99
€12-12.99
€11-11.99
€10-10.99
€9 - 9.99
€8 - 8.99
€7 - 7.99
€6 - 6.99
€0 - 5.99
MAT DEC 15 MAT DEC 16 Vol Share Chg
2.2 2.0 -0.3%
0.8 1.0 0.2%
1.2 1.7 0.4%
2.6 2.0 -0.5%
9.7 6.2 -3.5%
27.9 25.6 -2.3%
33.3 40.9 7.6%
15.7 14.1 -1.6%
2.5 1.2 -1.2%
4.1 5.3 1.2%
TOTAL 100% 100%
Source: AC Nielsen scantrack 2016
.

H i gh excise rates
Table wine - €9 standard bottle
Impact of taxes at differing price points
BUDGET
2011
BUDGET
2012
BUDGET
2013
BUDGET
2014
BUDGET
2015
BUDGET
2016
BUDGET
2017
Retail Price
€9.00
€12.00
€18.00
€24.00
PACKAGING &
DISTRIBUTION
€3.60
€4.80
€7.20
€9.60
€3.53
Excise
& VAT
€3.65
Excise
& VAT
€4.46
Excise
& VAT
€4.87
Excise
& VAT
€4.87
Excise
& VAT
€4.87
Excise
& VAT
€4.87
Excise
& VAT
Tax (Excise + VAT)
€4.87
€5.40
€6.48
€7.68
39%
TAX
41%
TAX
50%
TAX
54%
TAX
54%
TAX
54%
TAX
54%
TAX
Wine
€0.53
€1.80
€4.32
€6.72
NO
CHANGE
2%
VAT
increase
€1
EXCISE
increase
€0.50
EXCISE
increase
NO
CHANGE
NO NO
CHANGE CHANGE
VAT & EXCISE
54%
VAT & EXCISE
45%
VAT & EXCISE
36%
VAT & EXCISE
32%
Excise due on the importation of 1000 cases of wine
BUDGET RATE Per Excise per
Year 9 LITRE CasE 1000 cases
2012 €23.60 €23,600
2013 €33.36 €33,360
2014 €38.24 €38,240
2015 €38.24 €38,240
2016 €38.24 €38,240
2017 €38.24 €38,240
TOTAL
INCREASE 62% €14,640
H igh Excise
• Jeopardises small local businesses and jobs by
creating cash flow pressures
• Affects consumers disposable income
• Increases price differentials between ROI and NI
• Affects tourism by eroding value for money perception
of Ireland
• Since 2011 the tax take form a standard €9 bottle of
wine has increased from 39% to 54%
• The total excise payable to revenue is now
€14,640 higher per 1000 cases than 2012

Excise: Tax on tourism
Ireland has the highest excise on wine in Europe, making our
tourism offering less competitive. Spanish tourists pay almost
twice the price for wine in Irish restaurants than they do at home.
Fáilte Ireland research has shown that the price of alcohol is one
of the main reasons why tourists wouldn’t return to this country.
Excise tax per 750ml bottle
Ireland
€3.19
Finland
€2.55
UK
€2.54
Sweden
€2.07
Estonia
€ 0.84
Portugal
€0.00
Spain
€0.00
Netherlands
€0.66
Belgium
€0.56
France
€0.03
Luxembourg
€0.00
Denmark
€1.17
Germany
€0.00
Czech Republic
€0.00
Austria
€0.00
Slovenia
€0.00
Croatia
€0.00
Italy
€0.00
Poland
€0.28
Hungary
€0.00
Greece
€0.16
Lithuania
€0.58
Romania
€0.00
Bulgaria
€0.00
Latvia
€0.56
Malta
€0.15
Cyprus
€0.00

WINE
MARKET
2016

Email: Jonathan.mcdade@ibec.ie www.abfi.ie
The Alcohol Beverage Federation of Ireland
Confederation House 84/86 Lower Baggot Street Dublin 2
Telephone: +353 (0)1 605 1581 Fax: +353 (0)1 638 1581