Wine Industry: Current Trends
At the 16th session of the General Assembly of the International Organization of Vine and Wine (OIV), which took place on 23 November 2018 in Punta del Este, Uruguay, Uzbekistan became a member of this organization.
Shahnoza Kadyrova, senior research fellow at the Institute of Strategic and Regional Studies under the President of the Republic of Uzbekistan, introduces us to the current trends in the development of the global wine industry.
Modern studies show that wine consumed in moderate volumes has a positive effect on the human body. Wine components are useful as prophylactic agents for many ailments: cardiovascular diseases, cancer, diabetes, etc.
I. TRENDS IN THE VITICULTURE MARKET IN THE WORLD
According to the International Organization for Vine and Wine (OIV), about 250 million hectoliters (hl) of wine (1 hl = 100 liters) was produced in the world in 2017, which is 8.2% less than in 2016 (266.8 million hl). One of the main reasons for the record decline in production was the drop in volumes in key wine producers in Europe.
Compared with 2016, wine production in Italy fell by 23% in 2017, in France it decreased by 19%, and 15% in Spain. In 2017, four smaller players managed to increase wine production: Portugal (+ 10%), Romania (+ 64%), Hungary (+ 3%) and Austria (+ 23%).
The total size of vineyards in the world today is 7.6 million hectares. Spain is the leader in the world in terms of the area of vineyards (967 thousand hectares), ahead of France (787 thousand hectares). In Italy, the vineyards occupy 695 thousand hectares.
II. FOREIGN PRACTICE
Viticulture in Europe is distinct in that almost all vineyards are located in mountainous and semi-mountainous areas. For example, 59% of vineyards in Italy are located on hills, 21% in mountainous areas and only 20% in lowland areas. In the structure of plantings in Italy, technical varieties are about 15 times more than the table varieties.
Italy produced 592 million hectoliters of wines and export earnings of Italian production in 2017 reached $ 6.8 billion.
France is the birthplace of grapes of such world famous varieties as Cabernet Sauvignon, Chardonnay, Sauvignon Blanc and Syrah, currently cultivated in other countries.
Almost 80% of the territory of France is suitable for growing grapes. The country has about 774 thousand hectares of vineyards set aside for the production of wine.
French winemaking is recognized around the world, while local specialists provide training in it, both in the country and abroad. French vineyard owners do not pay wealth tax (75%), when buying a vineyard you will need to pay only 6% of the tax on its value.
Today, over 50 thousand companies in France engaged in the production of wines are successful. Income from exports amounted to more than $ 10 billion in 2017. About 120 thousand jobs are there in this sector of the economy.
In Spain, more than 300 different grape varieties are cultivated. Spanish winemakers regularly experiment with new wine brands. However, mainly (85%) local grape varieties prevail here such as Airen, Garnacha Blanca, Moscatel, Macabeo, Malvasia, Tempranillo, Monastrell, etc.
Spain annually produces an average of about 35 million hectoliters of various types of wine. It accounts for 22.7% of the vineyards of Europe. As evidenced by the data of the Spanish Observatory for the Wine Markets, in 2017 Spanish local wine companies for export have relied on quality. In total, they sold abroad 22.8 million hectoliters of wines worth $ 3.3 billion
The most extensively the branch of viticulture in the CIS space is represented in Azerbaijan, Armenia, Georgia, Moldova, Russia, Uzbekistan and Ukraine.
Approximately 70% of the grapes grown in Moldova are wellknown European varieties such as Cabernet Sauvignon, Merlot, Pinot Noir, Sauvignon Blanc, Chardonnay, Aligote. The area occupied by vineyards in Moldova is about 140 thousand hectares, of which 105 thousand hectares are used for commercial purposes.
27% of the working population of Moldova is employed in the viticulture and wine industry. 40% of vine plantations are controlled by farmers, 35% are owned by cooperatives, 25% are owned by wineries.
The wine industry is a strategic sector of the Moldovan economy, which forms 3.2% of GDP and accounts for 12% of total exports. 80% of the wine is exported to more than 50 countries. Wine exports amounted to 14.1 million decaliters for a total of about $ 156 million in 2017.
Aboriginal grape varieties are widespread in Georgia: over 500, of which several dozens are officially allowed for use in winemaking. In addition to local varieties and imported common: Chardonnay, Aligote and Cabernet Sauvignon.
The area of vineyards in Georgia over the last year increased by more than 1.5 thousand hectares, which today accounts for 37.5 thousand hectares. The Kakheti region is the largest wine-growing area in the country, which accounts for 70% (22.2 thousand hectares) of vineyards.
According to the Ministry of Agriculture of Georgia, today about 22 thousand farmers work in the viticulture sector. Officially registered more than 130 companies that export wine. In January-August 2018, wine exports to 60 countries grew by 13% and amounted to 60 million bottles. Export revenues amounted to $ 142 million, which is 22% higher compared to the same period in 2017.
In Azerbaijan, the area of vineyards occupy up to 24 thousand hectares. More than 450 local grape varieties are known. Besides local European varieties such as Pinot Noir, Verdelio, Cabernet, Malbec, Semillon, and others, cultivated in small areas give valuable wine products.
In 2017 Azerbaijan produced more than 1 million decalitres of wine production, of which 375,000 decalitres were exported. Income from exports amounted to $ 6 million, which is 67% more compared to 2016.
In all of the above countries, there are laws on grapes and wine. The task of the laws is to provide comprehensive assistance to the development of viticulture and winemaking as a priority area of the country's economy, the production and sale of competitive grape wine, and the protection of the consumer market from counterfeit and lowquality products.
In 2006, the Parliament of Moldova approved a new edition of the “Law on Wine and Grapes”. According to him, wine is no longer considered an alcoholic beverage.
Moreover, there are programs and special government agencies that support and regulate the production of wine and wine products. For example, in Azerbaijan within the framework of the programs for 2012-2020. It is planned to plant about 50 thousand hectares of new vineyards. Initially, local native and imported grapes will be used for planting new vineyards, and then vaccination complexes will be built. About 40–50 million pieces of cuttings are planned to be planted annually at these sites with the production of 12–14 million grafted seedlings.
In 2017 through the National Fund for the Support of Entrepreneurship of the Republic of Azerbaijan (NFES), companies engaged in the production of wine products received preferential loans in the amount of $ 23.5 million. To farmers who grow grapes in 2017. At 50% discount, fuel and engine oils were sold. Farmers received fertilizers at a 70% discount; the state paid 40% of the value of agricultural machinery.
In 2017 The Georgian Agricultural Project Management Agency has provided financial assistance in the field of viticulture. As a result, manufacturing companies received concessional loans in the amount of $ 22 million, in which 8% of the total loan amount will be financed by the state. Also, vineyards on the area of 5.1 thousand hectares are insured.
Georgian National Wine Agency since 2014 keeps a register of vineyards. The agency provides a cadastre of vineyards, registration, certification and specification of zones, and clarification of boundaries.
Passports simplify the communication of winegrowers with wine companies; facilitate the process of receiving wine materials.
The introduction of the world’s latest achievements of science and technology in viticulture and winemaking is carried out in France by a special Institute of Grape and Wine. In Paris, the headquarters of the OIV and the world’s largest National Institute for Agronomic Research are located.
Research and training in the field of viticulture and winemaking in Italy are conducted in research and educational institutions. The main ones are: 1) Scientific Research Institute of Viticulture (Conegliano-Veneto); 2) Institute of Wine (Asti); 3) Institutes of viticulture and winemaking in Alba, Avellino, Catania, Marsala, Locorotondo. The Italian Academy of Grape and Wine is located in Siena. It coordinates the work of its scientific centers, informs the world's major scientists working in this field of science, and has extensive international contacts.
Scientists of the Georgian Research Institute of Horticulture, Viticulture and Winemaking of the Institute developed and selected about 150 high-yielding varieties and clones of grapes, created a complex of grafting machines, etc. Moreover, the Institute buys cuttings and saplings of European grape varieties for reproduction and planting. The institute has specialized councils for awarding a degree to a candidate. Sciences in viticulture, fruit growing and winemaking, graduate school, a museum of viticulture and winemaking.
The Azerbaijan Research Institute of Viticulture and Winemaking will play a large role in the development of viticulture and winemaking on scientific bases. The institute has 5 departments (the department of grape processing and wine technology, the department of agrotechnics of grapes, the department of plant breeding and nursery, the department of viticulture and nursery, the department of information support and implementation of scientific results) and 4 laboratories, as well as the Ganja and Shamakhi stations and the Jalilabad base station.
One of the ways to promote the brand of winemaking is to stimulate wine tourism in the territories involved (visiting wineries, vineyards, wine festivals and other events).
Today, France is the most popular country in terms of wine tourism.
Every year in October in Montmartre (Paris) the annual Wine Festival is held in honor of the new grape harvest. The French Beaujolais Nouveau wine festival takes place in November throughout the country, mainly in the town of Beauzho, the birthplace of famous wine. His goal is to support local producers and popularize the best French wineries around the world.
Every year in May, a festival of young wine is held in Tbilisi. By May, the wine prepared according to traditional Georgian technology in Kvevri vessels (a clay jug for aging wine) ripens and waits for the moment when it can be tasted. Georgian traditional method of making wine in kvevri in 2013 awarded the status of a monument to the intangible cultural heritage of UNESCO.
Every year in October, the Republic of Moldova celebrates the National Wine Day. In honor of this event, a preferential visa regime has been established for foreigners (7 days before and after the holiday).
During the year, the National Bureau of Vine and Wine of Moldova holds 115 advertising campaigns: events, public relations, organization of meetings with journalists from different countries, training courses. To improve the culture of wine consumption in the country, the Moldova Wine Academy is being created.
For 2017 wine exporters to promote products under the brand “Made in Azerbaijan” participated in 7 international exhibitions (in Germany, China, France, Moldova, etc.) with a single national stand. Moreover, wine houses opened in China (Urumqi, Beijing), in Belarus, Russia and Latvia.
III. PROSPECTS FOR UZBEKISTAN
Today, after a thorough inventory of existing vineyards by Uzsharobsanoat JSC together with the State Research and Design Institute for Land Management, only 73.3 thousand hectares of vineyards were identified, of which 11.5 thousand hectares are technical varieties.
In order to improve the situation, Uzsharobsanoat JSC developed and approved by the Cabinet of Ministers of the Republic of Uzbekistan. The program for 2018-2023 on the creation of new, with the introduction of modern agrotechnical and innovative technologies of technical grape vineyards on the territory of the republic by the cluster method. As a result, by the end of 2023, the area of existing technical varieties of vineyards will reach 27 thousand hectares and by 2027 yield of existing technical varieties of vineyards will reach 27-28 thousand tons of quality grapes, enabling the production of exportoriented wine.
To date, there are 5 wine tourist zones in Uzbekistan, organized at the plants of the enterprises of the JSC AI “Combine Tashkentvino”, Khovrenko Samarkand Winery JSC, LLC Mindonobod Agrosanoat, LLC HAMKOR and JSC Urgench Sharob.
In general, according to experts, the favorable soil and climatic conditions of Uzbekistan guarantee an effective and cost-effective development of winemaking. Taking into account foreign experience of promoting wine-making products as a national brand, as well as in order to expand wine exports by Uzbekistan to international markets, it seems appropriate:
- consideration of the adoption of the “Law on Winemaking” of the Republic of Uzbekistan on the basis of a study of the legislative framework of foreign countries; the creation of the Uzbekistan Association of Producers and Exporters of Wine, identifying its main tasks as the unification of specialists, the creation and promotion of a national brand, the development of proposals for expanding the export of a product, etc.;
- establishing cooperation with research institutions and higher educational institutions of EU countries in order to develop teaching materials and improve the qualifications of teachers of universities of Uzbekistan in the field of training of specialists in the field of winemaking;
- study the schedule and conditions for participation in major international exhibitions and wine festivals (“ProWein”, “Holy Family”, Prague Wine Week, Wine Festival in Montmartre, Freiburg Wine Festival) to ensure the participation of national wine producers at these events;
- stimulation of wine tourism in the territories involved by improving infrastructure; To study the issue of holding international fairs, festivals and wine exhibitions, scientific and applied conferences and seminars in Uzbekistan with the aim of popularizing the national product.