FRANCE: Wine closure market set for growth - research

By | 2 March 2007

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."

Sectors: Wine

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FRANCE: Wine closure market set for growth - research

There are currently 7 comments on this article

Mike, you are right to be concerned about possible contamination of spirits by some synthetic materials, since the range of materials available is close to infinite and not all are as neutral or stable as SupremeCorq. As with many things in life, it's important that producers are diligent in testing closures they are considering. Any reputable producer will have conducted extensive external testing that can be proven with independent lab reports etc. As far as I am aware Herradura have never trialled our products, we'd be delighted if they did!

You are also right to pull me up on the deluxe spirits with screwcap closures point! The issue is over how we classify categories of spirits. My early career was in the Scotch Whisky industry, where most blended whiskies, even premium brands, are sealed with screwcaps, whereas most malt whiskies, which tend to have higher retail prices, are sealed with natural cork closures.

Norman, you are right that Dewars' White Label is a premium whisky - I used to sell it and remember the huge barrel store they had in Perth, Scotland! Sadly now in different hands due to industry consolidation, but the brand is still great. Again I think the misunderstanding is in classification of spirit categories. Dewars' used to have a bar top natural cork closure many many years ago and switched to screwcap 30+ years ago to avoid the problem you describe of corks drying out and breaking. As mentioned, many malt whiskies still use natural cork bar top closures and, along with some other super-deluxe spirits, this is a category that is showing a lot of interest in synthetic closures to retain the appearance of the bottle.

Whatever you're drinking this evening and whatever it's sealed with, cheers from London!


Simon Waller said at 5:30 pm, March 16, 2007

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