Supply Chain Research

The U.S. wine industry is having a tough end to 2017, though consumers aren’t going without these holidays. Exports of wine from the U.S. slumped 17.0% in October, and are down 8.9% for the past three months on a year earlier Panjiva data shows.

That’s likely been the result of supply chain disruptions in California after this year’s wildfires. More stringent rules in Canadian retail, as outlined in Panjiva research of October 3, does not appear to have had an effect with imports actually having risen 10.8% in October. Imports meanwhile have compensated, with a 6.0% rise in the past three months.

Chart compares U.S. imports and exports of wine on a three month rolling basis. Source: Panjiva

That pattern has continued, with seaborne imports indicating a 7.3% rise in shipments for the month of November. The expansion in imports has been led by Pernod Ricard – which has expanded shipments by 20.8% – and MHCS which has expanded by 59.3%. Pernod Ricard specializes in New World wines (including 29.3% from New Zealand and 18.5% from Australia) while MHCS ships almost exclusively from France.

The biggest loser has been Giorgio Gori, with imports which fell 2.5% and likely reflecting a shift in tastes away from Italian wines (which account for 55.4% of its shipments).

Chart segments U.S. wine imports by sea by shipper. Bubble size indicates total shipments. Source: Panjiva

There has also been a shift in beer tastes. In aggregate imports in the three months to October 31 were 6.5% higher than a year earlier including seaborne shipments and those by land from Mexico. Yet, within that shipments from Germany and the U.K. fell 41.1% and 49.8% respectively, while those from Belgium and Holland climbed 7.3%. That trend likely continued in November with seaborne imports having increased 2.2%, led by a 27.7% rise in shipments from Belgium and Holland.

Chart segments U.S. beer imports by region of origin, including by land from Mexico. Source: Panjiva

In general though Americans will be knocking back more of the hard stuff this year, with imports of wine and spirits both reaching a new record in October. Imports of spirits in particular have seen a significant expansion, climbing 7.2% on a year earlier to reach $752 million. Growth there has been led by tequila, which climbed 38.0% in October, and brandy which has increased by 19.0%.

Chart compares U.S. imports of beer, wines and spirits. Source: Panjiva

The biggest beneficiary of the boom in Mexican tequila exports has been Beam Suntory’s Tequila Sauza which saw a 93.6% rise in exports vs. a year earlier, while Patron Spirits climbed 57.7%. Both have nearly caught long-time leader Casa Cuervo which has lost ground, falling 13.9% in October and 18.7% in the past three months.

Chart segments Mexican exports of tequila by shipper. Source: Panjiva