Bulgaria’s evolving wine market presents new opportunities
Post forecasts Bulgaria’s 2017 grape crop at 250,000 metric tons (MT), most of which will be used to produce about 140 million liters of commercial wine. The Bulgarian wine sector continues to evolve, driven by investments in the sector, increasing disposable incomes, tourism, and thriving retail and HORECA sectors, reports the United States Department of Agriculture (USDA).
Rain disrupted the 2017 harvest in some areas, but the overall quality of the crop was reported as favorable and better than 2016. The 2016 wine grape production declined from the 2015 record by 19%. Total vineyard acreage remained static, but harvested area decreased by 6% due to unfavorable weather and a larger non-harvested area.
According to the Ministry of Agriculture and Food of Bulgaria statistical survey, 47,179 farms grow wine grapes in Bulgaria, with 27 % concentrated in the southcentral region, and 25% located in the southeastern region. Bulgarian varieties such as red Pamid, Mavrud, Gamza, Rubin, and Melnik as well as white Dimyat account for about 20% of vineyards and are becoming more popular among wine makers due to their unique characteristics.
New product launches, increased promotional events, and social media marketing attracted more attention and boosted sales in 2016 and 2017. 2016 wine sales achieved 3.4% growth over the previous year, reaching 126 million liters (source: Euromonitor). Market assessments indicate that similar levels of growth will persist through 2021 when wine sales are forecast to reach 149 million liters. Sales increased in value by 3.1% in 2016 to $650 million with prospects of reaching $710 million by 2021.
Bulgaria is a net wine exporter, although its exports have declined in absolute and relative terms. During January-October 2017, exports declined by less than a 1% in volume (24.4 million liters) but increased by 8% in value ($32 million) over the same period in 2016. Wineries are trying to shift exports to Western Europe, Asia, and the United States. Exports to the United States, Sweden, China, and Japan saw double-digit growth. The top export markets by volume remained Poland and Sweden, as Russia coming in at third-place. In value terms, China outpaced Russia with ($4.7 million versus $2.7 million).
In January-October 2017, imports rebounded and had a strong growth of 24% in imported quantities and 21% in value to $14.3 million due to favorable demand. The average import price declined slightly to $2.24/liter. Spain, Italy, France, Germany and New Zealand were the top suppliers with double-digit growth for each country. Also during this period, direct U.S. wines exports grew by 50% (9,550 liters) and by 108% in value ($90,000). FAS Sofia research showed that U.S. wines enter the market not only directly but also through transshipments via Belgium and Germany, which increases total Bulgarian U.S. wines imports by an additional 10,000 liters and about $100,000 in value terms.