Total volume sales of wine declined in 2021, with port, champagne and other sparkling wine categories to buck the negative sales trends and register positive sales growth during the year. One of the main reasons for the pressure that came on demand for still light grape wine towards the end of the review period was the reduced importance of cross-border sales.
2021 saw on-trade sales of wine register a moderate increase after decreasing substantially at the peak of the COVID-19 pandemic in 2020. This unfavourable performance during 2020 was largely the result of the limited access that consumers had to on-trade establishments, which was in turn due to the imposition of social distancing regulations designed to curb the spread of the COVID-19 virus among the local population.
The entry into Latvia of German discount grocery retailer Lidl & Schwartz GmbH during 2021 has the potential to change the way that Latvians shop for wine, with major implications for the competitive environment in the category. First of all, private label is expected to generate significant sales increases as a result of Lidl’s presence in the category as the retailer’s discounters stock a wide range of attractive, high-quality wines covering different categories under numerous private label ranges, each of which is calibrated to a specific price segment.
With life in Latvia expected to return to some semblance of pre-COVID-19 normality during the forecast period, wine is slated for positive total volume growth. In particular, on-trade sales are expected to on-trade consumption recovers from the dramatic declines seen at the peak of the COVID-19 pandemic in 2020.
During the forecast period, German discount grocery retailer Lidl is expected to become an increasingly important player in wine following its recent entry into Latvia. In addition to improving the position of private label in the category, Lidl’s presence in the category is expected to push unit prices down generally as many branded players are expected to review their pricing policies in order to remain competitive.
It is unlikely that still light grape wines imported from Italy and France will lose their status as the most popular types of wine in Latvia before the end of the forecast period. This dominance of French and Italian wine also applies to sparkling wine and this is a reflection of the frictionless trade that Latvia enjoys with France, Italy and other major wine-producing countries such as Spain and Germany due to its membership of the EU.
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This is the aggregation of still and sparkling light grape wines, fortified wine and vermouth and non-grape wine. In terms of alcohol content, light wine usually falls into the 8-14% ABV bracket while fortified wine ranges from 14-23% ABV. Low and non-alcoholic wine is also included in the data (attributed to each sector as appropriate).See All of Our Definitions
This report originates from Passport, our Wine research and analysis database.
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