FRANCE: Wine closure market set for growth - research
The synthetic wine closure market is set for significant growth over the next three years, according to a report by industry analysts Skalli & Rein.
In a survey of 1000 industry individuals conducted by the wine industry analyst, synthetic corks obtained a high rating for reliability and quality in the New World as well as in the Old World, according to the report. Industry executives from 55 countries responded to the survey, which was designed to confirm the key factors that make a winemaker choose a closure and see how this changes accordingly to the country of origin.
Skalli & Rein said it believes that the market of Synthetic Corks will reach 6bn units by 2010. In 2006 synthetics represented 12.6% of an industry made up of 19.6bn closures.
David Skalli of Skalli & Rein told just-drinks: "Synthetic Cork is usually the cheapest closure on the market, priced between EUR45 (US$59.3) and 85 per 1000 units. It has been a key factor in explaining the tremendous growth of synthetics in the past few years. Add that to the fact that Synthetic Corks claim to have eradicated TCA and you've got a great product."
However, Skalli warned that it would not be all plain sailing, pointing out a number of problems that needed to be overcome.
"First of all there is a historical strife that exists between the two leaders (Nomacorc and Supreme Corq) due to a patent "incident". Also, the existence of two kinds of synthetic cork ("moulded" and "extruded") really splits the market in two and is a permanent topic of discussion among professionals. We also have to admit that, scientifically speaking, synthetic corks have a high level of oxygen transmission which gives the wine flavour scalping.
"Nevertheless, the survey showed that Winemakers perceived the synthetic cork as being more reliable than the natural cork."
However, the survey revealed that another issue is the hardness of extraction and reinsertion of a synthetic cork.
"Knowing that the biggest wine consumers are women and that the wine drinking population is ageing makes this last point a key concern," said Skalli. "Innovation is therefore important and investments in research and development are a significant matter. Finally, price point fights in the past few years have been devastating to the profitability of the industry," Skalli added.
Skalli continued: "The most important point is to set aside all the discordances, reach a gentlemen's agreement between key players on patent and price. Instead of trying to gain market share inside the synthetic cork industry, major players should find a way to grapple volume from other type of closures. If they do not find a solution, they will become stuck between the historical natural cork leaders, which are rethinking their strategy by dramatically decreasing their TCA levels and the screwcap, which has been increasing by 80% in volume since 2003.
"Now, in order for synthetic corks to keep up with their competitors' pace and achieve a significant increase of market share, one of the biggest steps forward would be to create a lobby for the synthetic closure business (like both competitors have done for so long). As Nomacorc and Supreme Corq represent more than 50% of the synthetic market share they should set aside their patent rivalry, start spending money on the synthetic cork concept and lead the way to the creation of an association to promote that kind of closure against the others."
Synthetic corks and screw-caps may have once been frowned upon by wine cognoscenti, but no longer, and the growing popularity of alternative closures has put the natural cork industry under pressure. ...
As in any product category, fashions come and go in the wine business. And, writes Chris Losh, it appears that Old World wines, whether recently rediscovered gems or traditional offerings given a mode...
The European Agriculture Commissioner Mariann Fischer Boel has unveiled the detailed plans for reform of the European wine sector, following a year of consultation. As expected, there has been some wa...
As Bordeaux châteaux prepare to release their 2006 en primeur prices, there are concerns that, carried away by the success of the extraordinary 2005 vintage, the Bordelais will overprice the altogethe...
McGuigan Simeon has posted losses for its financial year as it tries to deal with what it has called a "perfect storm" scenario in Australia....
Australian wine producer McGuigan Simeon Wines has teamed up with Holland's second largest wine importer/distributor, Groupe LFE....
Carlsberg has lined up a range of wines exclusively for the UK on-trade....
Enotria has appointed a new director of sales for the UK off-trade....
- Focus - Edrington's FY Performance by Brand
- Where Beer is Brewed Can Leave a Bad Taste
- Analysis - Storm clouds lift over Diageo Towers
- Analysis - Cider's Campaign Gains
- Analysis - SABMiller's LatAm aim? Drink more beer
- Former Bacardi exec takes De Kuyper CEO role
- Pernod Ricard appoints Absolut Vodka VP
- Edrington posts FY profits drop
- Beam Suntory to re-package Courvoisier Cognac
- TWE, Pernod hail China-Aus FTA
- Global liqueurs insights - market forecasts, product innovation and consumer trends research
- The IWSR Company Profile 2014 – Remy Cointreau
- Diageo plc (DGE) - Financial and Strategic SWOT Analysis Review
- Global Tequila insights - market forecasts, product innovation and consumer trends research
- Beer, 2014 and the future