Retail wine sales hit six-year high as Brexit pushes up prices

By Jo Gilbert

Published: 13 September, 2017

Sales of still wine in the off-trade saw record value growth in the last quarter new figures show, as well as the largest increase in average prices since April 2014.

New figures released by the WSTA in their Q3 2017 market report show that still wine grew by 5% in the 12 weeks to June 17 - the largest quarterly growth in value for still wine in the off trade since August 2011.

The figures are the first to be released which show a pre and post quarter comparison following the UK referendum on June 26, 2016.

As with most quarters, positive value growth between April and June 2017 was in the higher price brackets.

All price points above £5.01 were in positive growth while the majority of wine price points under £5 declined in growth.

But during this quarter, still wine saw the largest increase in average prices since April 2014 and the gap between volume and value growth also widened significantly.

In terms of quarterly sales, volume growth increased only by 1%, but value grew by 5%, leading to a 4% increase in average price per litre (£7.45 (75cl: £5.59)).

This is in line with expectations, the WSTA said, with sterling’s devaluation and duty increases in March both contributing to higher bottle prices.

Still wine’s value growth for the six months to June 17 was 2.4% which - along with spirits at +3.7% - was behind total alcohol (+3.9%).

The alcohol category as a whole saw a sales increase of £260.6m for January to June versus the same period a year ago.

Beer was the category that contributed the most to this, adding £91.4m, followed by spirits (+£59.2m) and still wine (+£55.1m).

But by far the fastest growing category was sparkling wine, which grew 11.5% in value – the only category to grow in double digits.

Value sales were in contrast to volume.

Nielsen analyst, Marika Pratico, who contributed to the report, said: “Total alcohol record[ed] flat growth +0.1% although spirits gained 1.2% and the popularity of sparkling wine continued with volume up 9.5%. Whilst light wine returns to growth in value terms its volume performance is still negative although improving (-1.1%) only behind fortified wine (-1.3%) and Champagne (-18.9%).”

It was a positive half-year for many categories.

However, Champagne continued to lose momentum, losing sales value of £11.7m, (-10.8%).

On-trade

In the 12 weeks to June 17, total alcohol sales in the off-trade rose by 3% in volume to 8 million hls and 7% in value worth £3.8mn.

In the on-trade however, sales were down by 3% in volume to 5.9 million hls while value remained static at £5.8mn.

There was a slight increase in yearly value sales, with “sparkling wine and spirits growth each accounting for around a fifth of the growth” according to the report.

Sparkling and fortified wine continue to buck the trend of increases in average prices.

Still wine saw the sharpest increase, up 6% in the 12 weeks after the March Budget.

In the on-trade, sparkling continues to be a major driver of growth.

If current trends continue, it is predicted the category’s yearly sales will pass £500m for the first time, doubling figures for 2014 which were worth £250m.

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