Wine to Spain

Trends and opportunities

The market

Spain has over one million hectares of land in wine grape production, the largest production area in Europe. Despite the area under cultivation, France has a larger production of wine than Spain. This is because many Spanish vineyards suffer from lack of rainfall, poor irrigation, poor soils and frosts.

The main production areas in Spain are:

• Castilla-La Mancha – 48 per cent of volume
• Catalonia – nine per cent
• Extremadura – eight per cent
• Valencia – six per cent
• Rioja – six per cent

The most common grape varieties are:

Red	White
Tempranillo	Airén
Garnacha	Viura
Monastrell	Albariño
Cariñena	Verdelho (known as verdejo in Spain)
Shiraz, which is now being planted extensively	Godello
Cabernet and Merlot – in smaller quantities	Chardonnay and Sauvignon Blanc are also now being planted

The ‘everyday’ wine (ordinary table wine) accounts for 18.8 litres of the total per head consumption and is sold mainly in bottles, but is also available in tetra-brick packs. Quality wines are always sold in 75cl bottles, and are usually reserved for celebrations or consuming out of the home.  Sixty per cent of quality wine sold in Spain is red, with rosé and white wines equally sharing the remaining 40 per cent. 

There are currently 54 designations of origin (denominaciónes de origen - D.O) in Spain, which have carefully controlled production standards. Wines have traditionally been promoted by their D.O., and so Spanish consumers tend to recognise wines by their D.O. markings rather than grape varieties. Some of the most popular D.O. wines are Cava, La Rioja, Ribiero, La Mancha, Penedés, Valdepenas and Rías Baixas.

Opportunities

The best opportunities for Australian suppliers are high-end, quality bottled wines. Spanish consumers tend to drink the lighter local table wines at mealtimes, but there are opportunities for special occasion wines and for products for the hotel, restaurant and catering sector to serve the 50-70 million tourists who visit Spain each year.

Competitive environment

Ninety five per cent of Spain’s imports come from other European Union countries, primarily France, Portugal and Italy. Australian wines reach Spain via small direct imports as well as via importers in the UK and other European countries, but these do not show up in the statistics.

Tariffs, regulations and customs

Spain is part of the harmonised trade system of the European Union (EU). Common Customs Tariff (CCT) is applicable to goods from non-EU countries, including Australia. Most duties are ad valorem (%), based on the GATT Valuation Code (approximate CIF value).

Wines incur import duty at rates that are set across the EU. Individual countries then set excise duty in bands that correspond with the alcohol content. VAT also varies across the EU.

Indicative Spanish import tariffs per 100 litres:

• Still bottled wine – €13.10
• Sparkling wine – €32.00
• Value Added Tax – 16 per cent (payable on duty-paid price by importer)

For more information on import duties on wines, contact Austrade Madrid or the Spanish Customs service in the importing city. The contact details for Madrid are:

La Aduana Española
Dependencia Regional de Madrid
C/Guzmán el Bueno 139
28003 Madrid
Tel: (+34) 91 582 6805

Consignment sizes: There are no official restrictions; importers may have their own restrictions as it may not be economically viable to import very small volumes.

Import requirements: An import certificate (or agrim) is required for imports over 3000 litres. A deposit (rates depend on the type of wine), is necessary. Deposits not exceeding €120 are exempted. The importer should request the import certificate prior to shipment. Importers should be registered at the Public Health Unit of the Autonomous Region's Government where they are located.

Validity of certificate: The remainder of the month in which it was issued plus four more months. The certificate is valid for all the EU countries.

Note:  Imported wines are subject to health inspection at customs.

EU labels require all mandatory information with the exception of the importer’s name, address and lot number to be in the Same Field of Vision (SFV), ie. the customer must be able to view the mandatory information without turning the bottle.

For wines described by geographical indication, the mandatory information required in the SFV is as follows:

• The geographical indication.
• The alcohol statement written as xx.x% vol. or alc. xx.x% vol. Minimum height: 3 millimetres for 750 millilitres.
• The volume statement. Only metric quantities permitted. Minimum height: 4 millimetres for 750 millilitres.
• Country of origin statement. Mandatory word is Australia – not Australian. This statement must be separate from any geographical indication claim and cannot be incorporated with a state or region.

For wines not described by a geographical indication, the mandatory information required in the SFV is as follows (remember, if no geographic indication, then no variety or vintage):

• The alcohol statement written as xx.x% vol. or alc. xx.x% vol. Minimum height: 3 millimetres for 750 millilitres.
• The volume statement. Minimum height: 4 millimetres for 750 millilitres.
• Country of origin statement. Mandatory word is Australia – not Australian.
• The word 'wine' is mandatory for products not described by geographic indication.

EU regulations specify that when detailing the importer on the label, the country must be indicated either by full name or by the postcode of the local administrative area. Therefore, a label for an Australian wine for sale in the UK could state the name of the importer and postal code only. In accordance with normal trading practices, if the importer then wanted to send a consignment to another EU member state, there would be no need to change the label.  (Source: AWEC)

(Source: Australian Wine & Brandy Corporation)

Industry standards

There are currently 54 designations of origin (D.O.), (the equivalent of France's ‘appellations contrôlées’) each with a regulatory body to guarantee that the wine is produced in the region specified, using the grapes and production methods as prescribed.  Because of this, Spanish consumers tend to recognise wines by their D.O. markings, rather than grape varieties. For more detailed information on Spain's D.O.s, please see the Spanish Ministry of Agriculture, Fisheries and Food (Spanish only).

Marketing your products and services

Market entry

Spaniards are generally drinking less wine but of better quality, which is a trend in Australia’s favour. Surveys have divided the Spanish wine market into four groups of consumers: passive, expert, elitist and experimental. Separate tailored marketing approaches may be required in order to target each of these different types of consumers with Australian wines.

The bulk of wine in Spain is consumed at home (45.3 per cent), hospitality venues (hotels and bars) and restaurants.

A strong, early presence in the market shows commitment and will lead to long lasting relationships with key distributors. Maintain regular contact with your Spanish contacts and actively assist with a wide variety of branding and promotional activities such as:

• In-store wine tasting and appreciation courses
• Print media promotions
• Price discounts for limited periods of time
• Direct marketing
• Exhibit at trade fairs such as Salon de Vinos, Intervin (Alimentaria March 2006)

Australian exporters of premium-bottled wines should aim to target Spanish importers, distributors and retailers, whose primary customer groups are in the high end of the hotel, restaurant, retail and catering markets. Another area of interest is the tourist market, which is concentrated mainly in the coastal and island communities of Spain. Each year Spain receives between 50–70 million tourists, many from other European countries where Australian wines are already well received.

Direct sales are made to Spain, however, some exporters prefer supplying via third countries, particularly the UK because it provides an English language access point to the European Union. This is still a viable market entry option, but it adds considerably to the end price of the product.

Distribution channels

The hotel, restaurant and catering (HORECA) sector is very important for wine distribution in Spain. It accounts for:

• quality wine - 70 per cent 
• sparkling wine - 50 per cent 
• table wine - 45 per cent

The HORECA sector in Spain is very important, due to the fact that Spaniards mostly entertain outside of the home, and the sector also caters for the 50-70 million tourists that visit Spain each year. The vast majority of hotels and restaurants buy through specialist distributors, although smaller enterprises may buy from wholesalers and traditional retail channels such as supermarkets.

Currently more restaurants and hotels list Australian wines, together with other imported brands, as taste trends are changing and there is greater demand for new or different wines. Higher-end supermarket chains carry a wide range of international wines, whilst the lower-end supermarkets will stock a far more limited range of table wines.

Most retailers buy through specialist importers, but some buy direct. Many retailers have established relationships with preferred suppliers, and accessing the retail sector should be considered a long-term proposition.

Spanish retailers:

• Specialist outlets (vinotecas), including online stores
• Mainstream wine retailers (bodegas), including online stores
• Department stores - El Corte Inglés and its gourmet sub-section
• Hypermarkets and supermarkets account for 59 per cent of retail sales but their price margins are very low
• Small convenience stores
• Discounters
• Direct marketing

Links and industry contacts

Wine–related resources

La Aduana Española - www.aeat.es
Wine Making and Oenology Centre - www.e-nologia.com/aso_esp.html 

Government, business and trade resources for Spain

European Union (customs) - www.europa.eu.int/comm/taxation_customs/customs/customs.htm
National Food & Beverages Industry Federation - www.fiab.es

Australian resources

The Australian Wine and Brandy Corporation - www.awbc.com.au
Cnr Hackney & Botanic Roads
Adelaide SA 5000
PO Box 2733
Kent Town Business Centre
Kent Town, SA 5071
Tel: (08) 8228 2000
Fax: (08) 8228 2022
Email: awbc@awbc.com.au

The Export Compliance Centre
2^nd Floor, 18 Dequetteville Terrace
Kent Town SA 5071
Tel: (08) 8228 2050
Fax: (08) 8228 2066
Email: awbc@awbc.com.au

Australian Wine Export Council - www.wineaustralia.com.au
Spanish Wine Federation
Federación Española del Vino
C/Padilla, 38
28006 Madrid
Tel:+34 91 576 27 26
Fax: +34 91 575 11 14

The Australian Wine Research Institute - www.awri.com.au
Corner of Waite Road and Hartley Grove
Urrbrae SA 5064
South Australia
Tel: (08) 8303 6600
Fax: (08) 8303 6601

Contact details

The Australian Trade Commission (Austrade) is the Federal Government agency that helps Australian companies win overseas business for their products and services by reducing the time, cost and risk involved in selecting, entering and developing international markets.

Austrade offers practical advice, market intelligence and ongoing support (including financial) to Australian businesses looking to develop international markets. Austrade also provides advice and guidance on overseas investment and joint venture opportunities, and helps put Australian businesses in contact with potential overseas investors.

A list of Austrade offices (in alphabetical order of country) is available.

More information

For further information please contact Austrade on 13 28 78 or email info@austrade.gov.au

(Last updated: 13 Jul 2007)