Can British sparkling wine succeed abroad?

The wine trade’s initial response to Truss’ rhetoric was decidedly mixed, with some commentators applauding the goal as completely obtainable, while others maintained their scepticism. Many buyers observed that achieving such a giant leap in export volumes was unrealistic, at least in the timescale allotted.

Yet after the successful – and plentiful – 2018 vintage in Britain, the trade’s cautionary voices increasingly look like they’re on a weak footing. What started as a brave venture by Felsted and Philton Manor in 1976 has morphed into a vibrant, growing industry, with approximately 2,888 hectares of vineyards planted – predominately in southern England – and a rash of new investment.

In 2018, 1.6m vines were planted, with a further 2m expected in 2019.

In 2018, 1.6m vines were planted, with a further 2m expected in 2019. Moreover, thanks to last year’s bountiful harvest, there are now as many as 10m bottles of sparkling wine resting in British cellars. The Champagne community also keeps a watchful eye on British progress – leading brands Taittinger and Pommery have invested in UK vineyards. A far cry from the general consensus 25 years ago, when English wine was derided as “tasting of rain”.

But perhaps now, at the height of our hysteria and navel-gazing, is an opportune time to pause for breath. Few critics would deny that leading brands produce a high-quality product; however, what is less certain is whether the goal to make British sparkling wine a key player in export markets is fantastical or achievable. According to IWSR forecasts (2017-2022), sparkling wine will continue to outperform the rest of the wine category, but with a CAGR of 1.6% for sparkling, the pace of growth is negligible.

Few critics would deny that leading brands produce a high-quality product; however, is the goal to make British sparkling wine a key player in export markets fantastical or achievable?

Spread worldwide, the volume of British sparkling wine exported will never be vast due to a shortage of suitable land, but even 2.5m bottles may be unfeasible for several reasons. IWSR data shows that in 2018, just 1,000 nine-litre cases of British sparkling wine were consumed in Sweden and Norway respectively, both sophisticated markets. In Hong Kong, that figure was a paltry 500 cases. Consumption is not forecast to rise in Hong Kong, although IWSR forecasts suggest that consumption could grow to 5,000 cases by 2022 in Norway and Sweden. Let’s face it, only well-funded corporate brands can afford the considerable investment that is required to break into highly competitive export markets – for the most part, the industry is composed of small growers.

The average size of a British vineyard today is two hectares – discounting the big players like Nyetimber – and the planting density is much less than Champagne. In this climate growers can expect an average yield of five tonnes per hectare, more likely three, while the average in Champagne is 12 tonnes. Hardly the easiest conditions in which to thrive and send significant volumes abroad – on average, the British export just 4% of their production.

Undaunted, several of the larger producers have signed deals with American importers, including Chapel Down, Gusbourne and Hush Heath in Kent, and Camel Valley in Cornwall. However, they should be under no illusions about the challenges ahead. “Launching a new wine in America is a very slow process. The US has the most ridiculous alcohol laws, so it easier to sell guns and drugs than wine. This is not going to be an overnight flash in the pan,” observes Bartholomew Broadbent, CEO of Broadbent Selections, pouring cold water on Truss’ figure of 2.5m bottles by 2020.

In addition, even the producers themselves admit that a certain degree of consumer patriotism – a USP that would clearly be absent in export markets – has aided greatly in boosting sales. There is also the crucial issue of price to consider. In the UK market, producers have typically emulated the price point of NV Champagne, building a strong reputation in the prestige restaurant sector and promoting UK sparkling wine as a product of equal quality. However, in foreign markets consumers may be reluctant to trade across from Champagne, or up from prosecco, especially as the patriotism card is no longer effective. Meanwhile, Champagne has retained its virtual monopoly on sales of luxury sparkling brands – the category’s global turnover set a new record in 2018, hitting close to €4.9bn, according to data released by the Comité Champagne.

The recent memory of 2018 should not blind producers to the harsh realities of growing grapes in a very mercurial and marginal climate.

The British climate must also not be omitted from this discussion. In vintages over the past decade – 2012 being a particularly unpleasant example – the weather has been so poor that several key producers, including Nyetimber, could not make any product. The recent memory of 2018 should not blind producers to the harsh realities of growing grapes in a very mercurial and marginal climate. Much will depend on the patience/ability of investors to mitigate the potentially disastrous effects of successive bad harvest and woeful yields, which is by no means an implausible scenario in Britain.

Much will also depend on the level of investment undertaken by the big well-funded companies such as Nyetimber over the next 10 years. The product will ultimately find a market outside of the UK, because it is good and distinctive, but this will take time and a lot of money. However, there are encouraging signs – in January 2017, Chapel Down announced it was entering the French market during Paris Fashion Week, after securing a partnership with luxury wine distributor Perles du Monde. Such an occurrence would have been unthinkable 10 years ago.

But equally, what is also clear is that British sparkling wine has a long march ahead before it becomes a widely recognised global name, and the 2020 goal suggested by Elizabeth Truss is probably unachievable. Rome was not built in a day, and neither will a sizeable export presence – Franciacorta is only just starting to see any traction, after over 12 years of continual investment. For now, it is British patriotism and palates that will continue to drive the success of this very nascent industry, rather than global ones.