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Eastern Europe to target lower end of the market

Eastern European countries are poised to take over the lower end of the wine market following investment and restructuring.

With New World producers more and more taking care of the higher end of the market (wines priced above £5 or €8), the old ‘Eastern Bloc’ – Hungary, Bulgaria, Georgia, Romania, Moldavia and Russia – are targetting the world’s market for lower-priced wines.

New research commissioned by the organisers of the London International Wine and Spirits Fair says Eastern European countries are well-placed for success. They have some 18% of the world’s vineyard space, low labour and land costs, and a central location at the heart of European, Russian and Asian markets.

Countries like Romania, Moldavia and Russia are all reworking their wine-producing policies and have attracted massive public and private investment.

Modern winemaking techniques are being adopted, and poorer quality vineyards dug up and replanted with either classic or indigenous grape varieties, which will attract younger consumers looking for something new. The £3.50-£5 (€5.60-€8.00) price range is reckoned to hold the most opportunity.

Two examples of this are quoted in trade magazine Harpers: Hungary’s Nagyrede Estate’s recent launch of Irsai Oliver, produced by Australian Kym Milne, and the Romanian Prehova Valley, produced by Halewood International.

The next step is to introduce the sort of regulatory systems that have given Western European wine production its credibility. It’s also likely that these countries may first test out their strategy and wines on Chinese and Russian markets before taking on the rest of the world.

In conclusion, Harpers reports, Eastern European countries ‘will focus their marketing on consumers aged between 17 and 23, mostly attracted by cheaper and less-sophisticated wines.’

Written by Liz Hughes16 May 2002

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