Algodon Wine Estates

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Grapes Generate Wealth

Source: Argentina.AR
09.24.2007

In Argentina wine is a synonym of quality, prestige, and good taste. Its flavour, texture and scent crisscross the world. But this is not everything, because the wine industry is also a way in which this sector makes its presence felt in the world and, also, to be a special component of the Gross Product of Argentina.

Following this line of thought the Argentine wine producers have submitted a strategic plan to the government so as to put the wine industry in a key position within the economy of the nation.

“This is a wealth-creating sector of great importance for the society’s sustainability” José Molina, the vice-president of the Corporación Vitivinícola Argentina (Coviar) assures. To confirm this statement, Coviar submitted a strategic plan to the government in order to position the Argentine wine industry among the most important ones in the world.

The amount of wine on offer for export continues to be headed by the old world, mainly on account of tradition and of strongly imbedded concepts like sophistication and “savoir faire” (in this part of the world France contributes 18% to its wine exports). Thus, the old world exports 62% of the world-wide export offer. The new world’s share is 25% of this same global offer . Within the latter region Argentina contributes 2%.

Within this context the producers’ idea takes off from the granting of credits and promotional measures aimed at the overhauling of the small and medium-sized producers. Eduardo Sancho, the president of Coviar, asserts that in the year 2010 “exports will reach 800 million dollars” which should be the stepping stone to get to the 2,000 million that are being targeted for 2020. This year the producers’ entity published a market audit to spread the information concerning the magnitude and the potential of the country’s wines.

Between 2004 and 2006 the demand of the Argentine Premium wine abroad (more than 10 dollars) was 116% larger than in previous years. The trend was the same for medium quality wines (between 5 and 10 dollars), the demand for which increased by 56%. “The Argentine wine export trend follows the world one, and the growth rates for the higher priced product are actually larger than the international ones” underlines José Zuccardi, the head of Wines of Argentina.

In the country’s internal market in 2004 there were 100,000 hectares growing single grape wines and 800 wineries distributed across the country, valued altogether at 700 million dollars. 350,000 people lived off this activity. During the last decade, more than 1,500 million dollars were invested in the wine industry.

“The consumer is becoming ever more demanding as regards quality and this compels us to remain alert to diversify our plantations and steer the offer according to the demands of the market”. This is the analysis made by Andrés Torrens, Coviar’s second vice-president.

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