Sustainably-focused Nordic markets offer opportunities in the on-trade and organic wines

Sweden

Sweden’s wine market is small (with only 5 million regular wine drinkers in a population of 9.8 million) and highly regulated (the state-controlled Systembolaget still dominates, despite encroachment from offshore retailers)  while consumption appears to have reached a stable peak (total wine consumption has been more or less the same since 2010). The Swedes happily consume 24 million cases of wine a year, all of which is imported.

Systembolaget dominates sales, of which 55 per cent are bag-in-box and 20 per cent are organic. The monopoly aims to grow organic wines to 25 per cent over the next few years. Its Australian buyer has recently returned to his home country of Switzerland and we are awaiting the new appointment.

Importers now offer a wide range of exclusive wines and some restauranteurs have their own importer businesses. It is common for restaurants to have their own sommeliers and these sommeliers have been remarkably successful in the international competitions.

Australia ranks fifth in market share and the value of Australian wines exported to Sweden increased by 26 per cent to $22.5 million in 2015. Exports of $10 per litre and above are up by 50 per cent to $1.4 million. Shiraz and Chardonnay are the top varietals exported and both are growing well. On a cautionary note, export data does not tell the full story, as much Australian wine is exported to the United Kingdom and elsewhere in Europe and later into Sweden.

Denmark

With a population of 5.6 million, the Danish market is small but incredibly energetic. The economy is robust and the wine market is in growth. Admittedly, some of this is due to the high level of promotion in the off-trade, which is dominated by the discounters. However, more encouragingly, the culinary scene has exploded and Noma (Copenhagen’s two-Michelin-star restaurant) has influenced a whole generation of restauranteurs and sommeliers.

Underlying the increase in premium sales in the on-trade is the specialisation in natural wines. Now accounting for 0.6 per cent of the market, it may still be tiny, but natural is the big city phenomenon that everyone is talking about. The positive knock-on effect is that young people are now going out to drink wine whereas ten years ago it was considered an old man’s drink.

Australian ranks fifth in market share and is in slight decline. Bulk accounts for 74 per cent of imports, reflecting the appetite for bag-in-box formats, which is common across the northern countries of Europe in the supermarkets and discounters.

Export data for Denmark is not as positive as that for Sweden. In the last financial year, the value of Australian exports to Denmark decreased by 9 per cent to $23 million. There was growth in exports with an FOB value per litre between $5 and $10, which increased by 29 per cent. Shiraz, Chardonnay and Cabernet Sauvignon are the top three varietals exported and are all growing.