US wine demand by volume is forecast to reach 1.2 billion gallons in 2021. Increases will be driven by continued expansion in disposable personal income and demographic shifts, in which a larger percentage of the growing population will consume wine. Further gains will be hindered by older, affluent baby boomers dropping out of the wine market, as they will be replaced by millennials and Gen X with lower net worth.
Prices Rising as Premium & Fashionable Wines Entice Millennials
Over the 2006-2016 period, demand for lower-priced wines posted volume gains as budget-conscious millennials entered the wine market. However, the trend forward is toward mid- and higher-priced wines as millennials and Gen X achieve higher incomes, which will be further supported by continued demand from younger baby boomers.
Millennials are especially interested in obscure, small-batch wines with an interesting story. The younger population is less loyal to name brands; additionally, young people place less emphasis on wine rating and expert opinion when judging wine quality. This is good news for new and small wineries. In fact, the number of US firms participating in the wine industry more than doubled between 2002 and 2012 amid growing interest in local wines and niche offerings. Such trends will buoy wine demand in both value and volume terms.
Bring Out the Bubbly!
Sparkling wine is projected to be the fastest-growing product segment on the strength of its appeal to young people, who tend to enjoy soft drinks and other sweet beverages. Younger millennials introduced to the wine market through products such as cava, champagne, prosecco, sparkling cider, and other sparkling varieties will be more likely to try other types of wine as well, boosting demand in all segments.
Want to Learn More?
For in-depth analysis of wine trends, see Wine: United States, a report published by the Freedonia Focus Reports division of The Freedonia Group.
The report contains historical data and analysis of wine demand and production in value and volume terms from 2006-2016 with projections to 2021. Demand is segmented by product type as follows:
While you’re there, you can check out other reports covering foods and beverages, such as Snack Foods: United States and Chocolate Candy: United States.
About the Author
Cara Brosius is a Research Analyst with Freedonia Focus Reports. She holds a degree in economics, and her experience as an analyst covers multiple industries.