Real Estate

Markets in this segment are currently a mix of producing and non-producing countries, where wine is becoming a more mainstream beverage-of-choice and is posting above-average growth. In terms of wine producing-countries two examples stand out: the pool of regular wine drinkers in Australia expanded by 700,000 consumers between September 2009 and September 2010; against the same measure, the US market grew by 4.1 million consumers over the same period (Wine Intelligence Calibration studies 2009, 2010). In both these markets we can discern two evolving phenomena: consumers switching into wine from beer or spirits, and consequent diversification of their imported wines repertoire. The New Zealand Sauvignon Blanc phenomena in Australia is a salient manifestation of this evolution –more consumers embracing wine as (one of) their beverage of choice; consumers reaching beyond the traditional Aussie wine boundaries for a pleasurable and affordable wine experience. Unlike the Traditional Established wine producing markets, the wine-producing countries in this segment are all New World -mainly vast countries where wine was historically the beverage of choice only in the producing regions themselves and per-capita consumption is still climbing out of historically very low levels. In the USA for example, per capita consumption in 1991 stood at just 6.7 litres (compared to 77.1 litres in France). By year 2000, US per capita consumption had reached 9.6 litres, a 43% increase over the preceding decade. Fast-forward another decade to 2009 , and per capita consumption had reached 11.6 litres, another 21% uplift (Figures based on IWSR reporting).The non-producing markets in this segment are Nordic countries, controlled by state-run monopolies. Common characteristics which can be ascribed to both Norway and Sweden from a wine industry investment perspective include:

•Monopoly retailing regimes which deliberately maintain relatively high prices and favour wine as a more...