The Brazilian Wine Market: Trends and Strategies for Italian Wineries

The Brazilian wine market presents a dynamic and growing landscape, representing a strategic opportunity for Italian wineries aiming for international expansion. Despite a global context that has seen a decline in consumption, Brazil has registered a significant counter-trend, with increased demand and considerable growth potential. This article explores consumption trends, market structure, and specific opportunities for Italian producers, based on the latest data and industry analyses. Further information: ITA Agency — Wines and alcoholic beverages.

The Brazilian Wine Market: A Context of Unexpected Growth

Why is Brazil an interesting market for Italian wine?

Brazil has demonstrated remarkable resilience and dynamism in the wine sector, reversing the global trend of declining consumption. It has registered significant growth rates, with an increase in demand that represents a strategic opportunity for Italian wineries aiming for international expansion.

In recent years, Brazil has experienced wine consumption growth rates not seen since 2000. In 2021, the country consumed approximately 430 million liters of wine, equivalent to over 573 million 750ml bottles. This figure is particularly significant when compared to the 2.8% decrease recorded globally in the same period.

How did the pandemic influence wine consumption in Brazil?

The COVID-19 pandemic accentuated the growth trend in wine consumption in Brazil. While many markets saw a decline, Brazil, along with Italy and Argentina, led a minority group of countries where consumption increased, primarily due to a rise in domestic consumption.

The growth rate of wine consumption in Brazil was 18.4% in 2020, compared to a global decrease of 2.8%. This phenomenon was largely attributed to increased at-home consumption, with consumers spending more time at home, thus favoring the purchase and consumption of wine within their households.

What are the data on global and Brazilian wine consumption between 2019 and 2020?

Source: OIV (2021) and data integrated from other sources. Note that some specific data for Argentina and total world consumption are from different sources.

Market Structure and Distribution Channels

How is the wine market in Brazil structured for distribution?

The distribution of wine in Brazil is entirely managed by private importers and distributors, with no state monopolies. In recent years, the market has seen significant consolidation, with a few large players dominating the sector.

The main multi-channel importers leading the market include Wine.com.br (approximately 10.6% of imported volume in 2021), VCT (the Brazilian arm of Concha y Toro) with 10.3%, and Evino+Grand Cru (now Víssimo Group) with 6.8%. These three companies alone accounted for over 25% of the market in 2021.

What are the main sales channels for wine in Brazil?

The final sales channels are diversified and follow an omnichannel model. These include specialized stores, direct e-commerce managed by importers, subscription clubs, large-scale retail (GDO), and the HORECA channel (restaurants, hotels, and wine bars).

GDO, in particular, has seen remarkable growth during the pandemic, representing a significant off-trade channel. Subscription clubs, such as Confraria Grand Cru, offer a specific business model to reach passionate consumers.

Import Duties and Trade Agreements

What are the import duties for European wines in Brazil?

European wines destined for Brazil incur significant price increases due to import duties. Currently, these duties can reach up to 27% for still wines and up to 35% for sparkling wines, impacting the competitiveness of European products.

How could the EU-Mercosur agreement influence the export of Italian wine to Brazil?

The EU-Mercosur agreement, once fully in force, represents a strategic opportunity to improve the competitiveness of Italian wines. The progressive elimination of customs duties over the next eight years could significantly reduce import costs, making Italian wines more accessible in the Brazilian market.

The EU-Mercosur agreement promises enhanced protection for European producers, with rapid procedures and strict monitoring. The Italian Wine Union (UIV) has emphasized how this agreement can consolidate growth prospects in a promising market like South America.

What is Italy's current market share in wine imports to Brazil?

Wine imports to Brazil reach nearly 500 million euros annually, but Italy's share stops at around 40 million euros, equivalent to 8% of the total. This figure highlights the growth potential for Italian exports, considering that the Brazilian market has over 250 million consumers.

Consumer Preferences and Trends

What is the per capita wine consumption in Brazil and what are the emerging trends?

The average Brazilian consumer has a relatively low per capita wine consumption, around 2 liters per year. However, there is growing interest in quality products, with a preference for red wines, followed by sparkling wines. White wines represent a niche, but one that is growing.

Consumers are increasingly seeking differentiated wines with pleasant sensory characteristics and from sustainable productions. This indicates a greater attention to the quality and origin of products.

Wines Export and the Territory

How can Wines Export support Italian wineries in exporting to Brazil?

Wines Export has a pool of several active buyers in the Brazilian market, a strategic asset for Italian wineries looking to penetrate or expand their presence in this country. This network of industry professionals represents a privileged channel for establishing targeted commercial contacts.

In-depth knowledge of consumer preferences, current regulations, and logistical challenges, combined with the ability to identify the most suitable distribution partners, makes this pool a fundamental starting point for export strategies.

Challenges and Opportunities for Italian Wineries

What are the main challenges for Italian wineries intending to export to Brazil?

Italian wineries looking to Brazil face strong international competition, particularly from Chilean and Argentinian wines. Other challenges include the complexity of logistics and distribution, and the need to adapt to local preferences. The concentration of the distribution market requires careful selection of partners.

What are the main opportunities for Italian wineries in the Brazilian wine market?

The opportunities are considerable: the growth in wine consumption in Brazil offers fertile ground, and the EU-Mercosur agreement promises to reduce tariff barriers. Italian wine enjoys an excellent international reputation, and the availability of qualified buyers through Wines Export facilitates market access.

To succeed, Italian wineries should focus on product differentiation, communicating brand value and history, and building strong relationships with local distribution partners. Exploring alternative or niche channels could prove to be a winning strategy.

Frequently Asked Questions

What are the duties applied to wines imported into Brazil?

Import duties for European wines in Brazil can reach up to 27% for still wines and up to 35% for sparkling wines.

Is the EU-Mercosur agreement already in effect, and what are its benefits for Italian wine exports?

The EU-Mercosur agreement is awaiting full entry into force. Once operational, it provides for the progressive elimination of customs duties over the next eight years, improving the competitiveness of Italian wines.

What are the main wine distribution channels in Brazil?

The main distribution channels include specialized stores, direct e-commerce, subscription clubs, large-scale retail (GDO), and the HORECA channel.

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