Market Information
Europe

Alcoholic Beverages Sector Profile(1) - Spain

December 2003

Canadian Embassy in Spain
Calle Núñez de Balboa, 35
280001 Madrid, Spain
Contact: Marc Gagnon, Commercial Officer
Tel.: (34-91) 423-3250
Fax: (34-91) 423-3252
E-mail: marc.gagnon@dfait-maeci.gc.ca
Internet: http://www.canada-es.org

MARKET OVERVIEW

Spain offers an attractive consumer market for foreign products and services in virtually every sector. The country has a growing gross domestic product, valued at just over $1.1 trillion(2) in 2002, and a population exceeding 40 million people.

The alcoholic beverages market is the second-largest segment in Spain's food industry, accounting for nearly 14% of the total food industry. Spain is a strong producer of wine and beer and an avid importer of spirits. In 2002, the alcoholic beverages market experienced steady growth, with sales rising 4% over 2001.

Sales of alcoholic beverages are influenced largely by the tourism industry. As a world leader in tourism, Spain can be a lucrative market for exporters of wine (especially ice wine), beer and spirits. In 2002, the number of visitors to Spain fell by 3% to approximately 75 million tourists.

Consumption of alcoholic beverages in Spain has also been influenced by recent economic and legislative developments. In 2002, prices of alcohol increased as a result of a rise in taxes on alcohol and the adoption of the Euro. In an effort to prevent reckless drinking, the Spanish government has also imposed a regulation prohibiting manufacturers of beverages with high alcohol content (i.e. more than 20%) from advertising or participating in any sponsorship agreement. Furthermore, the legal age for purchasing alcohol changed to 18 years old and the sale of alcohol after 11 p.m. is prohibited.

Moreover, the buying patterns of many Spaniards demonstrate an increased health awareness among consumers. Consumers are leaning toward purchasing alcoholic beverages that have been found to provide some health benefit, such as red wine, or those with a low alcohol content. As a result, many producers of alcoholic beverages are developing new products to fit this trend.

In 2002, Spain imported approximately $1.7-billion worth of alcoholic beverages, representing 92% of total beverage imports to Spain. While overall imports of alcoholic beverages declined by 7% over 2001, imports of wine climbed 11% to exceed $100 million. Wine imports were evenly distributed: still wines accounted for 48% of the imported wine market and sparkling wine, 45%. Spirits--particularly whiskies--were the largest segment of alcoholic beverages imports, accounting for 72% of the total. In 2002, spirits imports amounted to approximately $1.3 billion, falling 8% from 2001. Beer imports, which accounted for 12% of alcoholic beverages imports, decreased by 11% to $203.4 million in 2002.

Alcoholic beverages imported into Spain are subject to import tariffs and labelling requirements set out by the European Union and a 16% value-added tax (VAT). For detailed information on import tariffs and labelling, contact the Canadian Embassy in Spain.

Wine

Although Spanish grape growers are challenged by dry weather, poor soil conditions and mediocre irrigation systems, Spain is the world's fourth-largest producer of wine. In 2002, Spanish vineyards yielded approximately 32 million hectolitres of wine, a 3% increase over the previous year. Wine production is anticipated to continue to increase, with volumes growing by nearly 13% by 2006. Close to half of Spanish wine is produced in Castilla-La Mancha. The best wines originate from Galicia, Catalonia and Castilla-Leon.

Spain is the fifth-largest consumer of wine in the world, behind France, Italy, the United States and Germany. Table wines account for 65% of wine consumption in Spain, however, high-quality wines are becoming increasingly popular. In 2002, total wine consumption dropped by just over 4% to 15.4 million hectolitres, ranking Spain's per-capita consumption the seventh highest in the world. While per-capita consumption of table wine fell over 10% to 20.5 litres, demand for quality wines increased, with per-capita consumption rising by 7% to 7.9 litres. Over half of quality/specialty wine sales is of red wines, followed by white wines (21%), sparkling wines (13%) and rosés (7%). Demand for quality and special occasion wines is expected to continue to rise.

In addition to the 16% VAT, Canadian exporters should also be aware of the import tariffs applied to wines, based on their type. For instance, bottled wine is subject to an import tariff of $19.45 (13.10) per 100 litres, while the tariff on sparkling wine is $47.51 (32.00) per 100 litres.

Beer

The tourism sector can, potentially, affect levels of beer consumption by up to 20%. As a result of the 3% decline in tourism in 2002, demand for beer decreased marginally (by just over 1%) to approximately 30.1 million hectolitres. However, the introduction of the Euro, and high demand for expensive varieties of imported and specialty beers, increased the value of the beer market in Spain. In 2002, Spain's beer market was valued at $3.3 billion, rising 6% over the previous year. Specialty beer represented the largest segment of the market, accounting for over half of beer sales, followed by lagers (38%) and ales and stout beers (7%). The beer market in Spain is forecast to continue to grow 1% through to 2006.

The non-alcoholic beers market is a growing segment in the Spanish market, spurred on by anti-drinking campaigns and Spaniards' increased awareness about their health. Spain is one of the largest consumers of low-alcohol or non-alcoholic beer in Europe. In 2002, consumption of low-alcohol or non-alcoholic beers increased 4%, reaching 2 million hectolitres.

Spirits

In accordance with other segments of the Spanish alcoholic beverages sector, spirits revenues have grown due to increased prices, while volume sales are down. The market for spirits in Spain was valued at nearly $10 billion in 2002, rising 5% since 2000. During that same period, sales volumes decreased by 0.8% to 329.9 million litres. The decline in consumption is fuelled by the negative image attributed to high alcohol-content drinks. However, according to Datamonitor, the Spanish market for spirits is forecast to continue its steady growth, increasing by 4% by 2004.

Spain is the largest whisky market in the world. Whisky accounts for over half of total spirit sales in Spain. White spirits are the next-largest segment, representing just over 14% of the total market, followed by brandy and cognac (10.3%) and rum (9.9%). While sales for white spirits and rum increased in 2002, demand for brandy and cognac declined significantly, dropping 27% since 2001.

Overall, imports of spirits to Spain declined by 8% in 2002. However, imports of rum climbed 32% to $210.7 million. The only other category in this segment that experienced an increase was imported vodka, which rose 5% over 2001 figures.

OPPORTUNITIES

Canadian companies interested in exporting their products to Spain will find opportunities particularly prosperous during the summer months. From April to July, tourism is at its peak and demand from the hospitality industry for quality alcoholic beverages is high.

Since Spain is a strong supplier of wine and beer products, and an avid importer of spirits, Canadian exporters will find most opportunities in niche markets of the alcoholic beverages sector. Products that present good market potential in Spain include quality and specialty wines, low-alcohol and non-alcoholic beers, whisky, and flavoured rum drinks (such as Malibu Rum and Bacardi Breezers).

As a result of poor weather conditions, Spanish vintners produced lower-quality wines in 2002. Canadian companies, therefore, may find good opportunities to market and sell specialty wines such as ice wine in Spain. Furthermore, Canadian exporters interested in entering the Spanish wine market are recommended to target the regions around Madrid and Barcelona, where consumers are more accepting of different and imported wines.

Consumers' increased attention to their health has opened up opportunities for beverages that contain lower alcohol content or provide some health benefit. In 2002, nearly one fifth of low-alcohol consumption was of low-alcohol/non-alcoholic beer varieties. Furthermore, the establishment of new legislation is discouraging consumers from purchasing drinks with high alcohol content. Canadian breweries should target the regions in Southern Spain, where per-capita consumption of beer is at its greatest.

Canadian suppliers should appoint a local agent or distributor who is familiar with import regulations and licensing requirements. Some international companies may also find it easier to conduct business in Spain by setting up a local office or operations in one of the country's major business centres, Madrid or Barcelona. The Madrid hub principally serves the central, southern and western parts of Spain, while Barcelona serves the north and east. Regional characteristics influence buying patterns. A competent agent or distributor takes this into account when marketing products.

Trade Shows

Event:
Alimentaria 2004
March 8-12, 2004 (Biennial)
Barcelona, Spain

Organizer:
Alimentaria Exhibitions, S.A.
Diputació, 119
08015 Barcelona, Spain
Tel.: (34-93) 452-1800
Fax: (34-93) 452-1801
E-mail: alimentaria-bcn@alimentaria.com
Internet: http://www.alimentaria.com

Event:
Salon del Vinos
November 23-25, 2004 (Annual)
Madrid, Spain

Organizer:
Emporio Ferial S.A.
Velázquez 28, 2º Izq.
28001 Madrid, Spain
Tel.: (34-91) 426-0780
Fax: (34-91) 576-6672
E-mail: emporioferial@emporioferial.com
Internet: http://www.salondelvino.com

KEY PARTICIPANTS

The Spanish alcoholic beverage industry is dominated by large multinational companies such as Spanish-owned Bodegas y Bebidas, Garcia Carrion and Miguel Torres, which are leaders in the Spanish wine market. Prominent participants in Spain's beer market include Heineken (Amsterdam), Scottish & Newcastle (United Kingdom) and Damm Group (Barcelona). There are approximately 21 breweries in Spain. The spirits market in Spain is relatively concentrated; the top three producers--Allied Domecq (United Kingdom), Diageo plc. (United Kingdom) and Pernod Ricard (France)--account for 51% of the market. Other key participants in the spirits market include supermarket private labels (9.2%), Bermuda's Bacardi (7.3%) and Spain's Osborne y Cia SA (5.7%), while small local spirits producers comprise the rest of the market.

The majority of alcoholic beverages imports to Spain originate from other European Union (EU) countries, particularly the United Kingdom (with 44% import share), France (11%), and Germany and Italy (6% each). EU members share a common agricultural policy, a joint transportation policy, free movement of goods and capital within member states and a common tariff on imported products coming from non-EU countries.

Canadian Position

In 2002, Spanish imports of Canadian alcoholic beverages dropped 29% to $1.3 billion. Whisky is Canada's leading alcoholic export to Spain, accounting for 89% of alcoholic beverages exports. Imports of Canadian wines showed strong performance in 2002, increasing by 178%, due to a significant price increase on Canadian wines.

PRIVATE-SECTOR CUSTOMERS

Canadian companies interested in penetrating the Spanish alcoholic beverages market should target the hotel, restaurant and catering (HORECA) sector. Given the large tourism industry in Spain, the HORECA sector accounts for 70% of quality wine sales, 50% of sparkling wine sales, 45% of table wine sales and 70% of spirit revenues. Other key customers of alcoholic beverages are supermarkets and retailers.

Approximately 80% of alcoholic beverages sales to the HORECA sector are supplied by a distributor or wholesaler. Therefore, Canadian companies should appoint a local distributor to access the Spanish market. Spanish importers tend to be conservative in their buying habits and expect to develop long-term relationships with their suppliers.

Barriers to accessing the Spanish market are generally those that apply to the European Union as a whole. Canadian exporters should consult the Canadian Food Inspection Agency regarding any certification requirement. Canadian companies will also find information regarding labelling requirements on the Agriculture and Agri-Food Canada Web site at http://ats.agr.ca/info/europe-e.htm.

KEY CONTACTS

Canadian Contacts

Agriculture and Agri-Food Canada
Sir John Carling Building
930 Carling Ave.
Ottawa, ON K1A 0C5
Contact: Sylvain Wilson, Senior International Market Development Officer
Tel.: (613) 759-7726
Fax: (613) 759-7506
E-mail: swilson@agr.gc.ca
Internet: http://agr.gc.ca

Association of Canadian Distillers
920 The East Mall, Suite 200
Toronto, ON M9B 6K1
Tel.: (416) 626-0100
Fax: (416) 626-3998
E-mail: info@acd.ca
Internet: http://www.canadiandistillers.com

Brewers of Canada
100 Queen St., Suite 650
Ottawa, ON K1P 1J9
Tel.: (613) 232-9601
Fax: (613) 232-2283
E-mail: info@brewers.ca
Internet: http://www.brewers.ca

Canadian Food Inspection Agency
59 Camelot Dr.
Nepean, ON K1A 0Y9
Tel.: (613) 225-2342
Fax: (613) 228-6653
E-mail: cfiamaster@em.agr.ca

Canadian Vintners Association
440 Laurier Ave. W, Suite 200
Ottawa, ON K1R 7X6
Tel.: (613) 782-2283
Fax: (613) 782-2239
E-mail: info@canadianvintners.com
Internet: http://canadianvintners.com

Department of Foreign Affairs and International Trade (DFAIT)
125 Sussex Dr.
Ottawa, ON K1A 0G2
Internet: http://www.dfait-maeci.gc.ca

International Business Opportunities Centre (IBOC)
Tel.: (613) 944-6000
Fax: (613) 996-2635
E-mail: iboc@dfait-maeci.gc.ca
Internet: http://www.iboc.gc.ca

Market Research Centre (TMR)
Contact: Sean McLean, Senior International Market Analyst
Tel.: (613) 996-0688
Fax: (613) 943-1103
E-mail: iboc@dfait-maeci.gc.ca

Market Support Division (TCM)
Contact: Rick Winter, Trade Commissioner
Tel.: (613) 995-1773
Fax: (613) 943-8820
E-mail: rick.winter@dfait-maeci.gc.ca

Western Europe Division (REO)
Contact: Mylene Paradis, Desk Officer
Tel.: (613) 995-8782
Fax: (613) 995-5772
E-mail: mylene.paradis@dfait-maeci.gc.ca

Export Development Canada (EDC)
151 O'Connor St.

Spanish Contacts

Embassy of Spain in Canada
Commercial Office
151 Slater St., Suite 801
Ottawa, ON K1P 5H3
Tel.: (613) 236-0409 or -0400
Fax: (613) 563-2849
E-mail: buzon.oficial@ottawa.ofcomes.mcx.es
Internet: http://www.docuweb.ca/SpainInCanada

Association of Spanish Wine Producers (Asociación Empresarial de Bodegas de Vinos de España--Avimes)
Enrique Larreta, 9-4ºA
28036 Madrid, Spain
Tel.: (34-91) 323-1155
Fax: (34-91) 323-2973
E-mail: avimes@vinosdelatierra.com
Internet: http://www.vinodelatierra.com (In Spanish)

Beer Manufacturers of Spain (Conferación Empresarial de Cerveceros de España)
Almagro nº 24, 2º Izquierda
28010 Madrid, Spain
Tel.: (34-91) 308-6770
Fax: (34-91) 308-6661
E-mail: info@cerveceros-es.com
Internet: http://www.cerveceros.org

Federation of Cellars from Jerez (Federación de Bodegas del Marco de Jerez)
Eguiluz, 2
11402, Jerez de la Frontera (Cadiz), Spain
Tel.: (34-95) 634-1046
Fax: (34-95) 634-6081
E-mail: fedejerez@fedejerez.com
Internet: http://www.fedejerez.com

Spanish Association of Ciders (Asociacion Española de Sidras--AESI)
Avilés, 4-5º
33209 Gijon, Spain
Tel./Fax: (34-98) 534-7742
E-mail: aesi@telecable.es

Spanish Association of Vermouth, Bitter Soda and Wine Aperitif Makers and Distributors (Asociación Española de Elaboradores y Distribuidores de Vermouths, Bitter Soda y Aperitivos Vinicos)
Adriá Gual, nº. 10
43206 Reus, Tarragona, Spain
Tel.: (34-97) 731-2958
Fax: (34-97) 732-0321
E-mail: efabregat@bacardi.com

Spanish Federation of Alcoholic Drink Manufacturers (Federación Española de Bebidas Espirituosas--F.E.B.E.)
Diego de León, 44, 2º dcha.
28005 Madrid, Spain
Tel.: (34-91) 561-7891
Fax: (34-91) 561-8955
E-mail: bespirituosas@worldonline.es

Spanish Food and Drink Industry Federation (Federación Española de Industrias de la Alimentación y Bebidas)
Diego de León 44
28006 Madrid, Spain
Tel.: (34-91) 411-7211
Fax: (34-91) 411-7344
E-mail: fiab@fiab.es
Internet: http://www.fiab.es

Spanish Wine Federation (Federación Española del Vino)
Padilla, 38
28006 Madrid, Spain

BIBLIOGRAPHY

Australian Trade Commission. Industry and Country Info. "Wine to Spain," 2002. Downloaded from http://www.austrade.gov.au on August 7, 2003.

------. "Food and Beverages to Spain," 2002. Downloaded from http://www.austrade.gov.au on August 7, 2003.

Canada. Department of Foreign Affairs and International Trade. "Guide for Canadian Business Visitors to Spain," September 2002. Downloaded from http://www.infoexport.gc.ca/ie-en/DisplayDocument.jsp?did=11832 on August 7, 2003.

------. "Import Regulations--Spain," March 2003. Downloaded from http://www.infoexport.gc.ca/ie-en/DisplayDocument.jsp?did=20990 on August 7, 2003.

Cerveceros de España. "Spain Beer--Economic Report. Key Figures 2001," 2001. Downloaded from http://www.cerveceros.org on August 8, 2003.

Datamonitor. "Profile: Spain--Beer," December 2002.

------. "Spirits in Spain," May 2003.

Euromonitor. "Alcoholic Drinks in Spain," February 2003.

FoodandDrinkEurope.com. "Rain dampens Spanish brewers' spirits," June 11, 2003. Downloaded from http://www.foodanddrinkeurope.com/news/printnews.asp?id=2346 on August 11, 2003.

------. "Tough times for Spanish wine," March 10, 2003.

Just-drinks.com. "Alcohol marketing--showing Iberian spirit," October 8, 2002.

------. "Spain: Wine consumption down 4% in 2002," March 27, 2003.

Spanish Federation of Food and Drink Industries (FIAB). "An Approach to the Spanish Food & Drink Industry," September 2001.

United States. Department of Agriculture. Foreign Agricultural Service. "Spain: Wine Competition Annual," November 12, 2002. Downloaded from http://www.fas.usda.gov/gainfiles/200212/145784857.pdf on August 7, 2003.

World Trade Atlas. Eurostat. "Spain--Beverage Imports from the World," 2002.

Useful internet sites

La Aduana Tributaria (Spanish Customs): http://www.aeat.es (In Spanish)

Agri-Food Trade Service: http://ats.agr.ca

CanadaEuropa: http://www.dfait-maeci.gc.ca/canadaeuropa

Department of Foreign Affairs and International Trade: http://www.dfait-maeci.gc.ca

EUROPA: The European Union On-line: http://europa.eu.int

European Union Customs: http://www.europa.eu.int/comm/taxation_customs/
customs/customs.htm

ExportSource: http://exportsource.ca

InfoExport: http://www.infoexport.gc.ca

Spanish Ministry of Health and Consumption: http://www.msc.es (In Spanish)

National Statistics Institute (Insituto Nacional de Estadística: http://www.ine.es

Strategis: http://strategis.gc.ca

1. The Government of Canada has prepared this Country Sector Profile based on primary and secondary sources of information. Readers should take note that the Government of Canada does not guarantee the accuracy of any of the information contained in this document nor does it necessarily endorse the organizations listed herein. Readers should independently verify the accuracy and reliability of the information.

2. All monetary amounts are expressed in Canadian dollars, unless otherwise indicated. The conversion rate to Canadian dollars is based on IDD Information Services, Tradeline, August 2003.

Date Modified: 2004-06-15

Important Notices