Brazilian Wine: Back in the Saddle

06 August, 2013

Brazil has many positives: football, carnival, the Amazon. Yet, as a wine producer it has been left behind. With the World Cup and Olympics looming, the sprint to catch up is on. Christian Davis reports

ALTHOUGH its apparent inexorable rise has been checked recently by disquiet and riots sparked by rising bus fares, the cost of staging the World Cup and Olympics and the cost of tickets, Brazil is the largest economy in Latin America. It is the third largest market for personal computers, fifth for mobile phones, and third largest agricultural producer. Only time will tell whether the civil unrest will have a long-term effect on the Brazilian economy.

Brazil is a huge producer of grapes, but they are mainly table grapes. It is the fifth-largest wine producer in the southern hemisphere after Chile, Argentina, Australia and South Africa. At a modest 2.2 litres per head per annum (France 45 litres, Uruguay 25 litres, Argentina 23 litres; Chile 18 litres), it is the 13th largest wine market. Between 2007 and 2012, wine consumption has increased by more than 30% from 1.64 l litres. Of the 2.2 litres, only 0.7 is ‘fine wine’ – made from vitis vinifera grapes. The rest were American or hybrid vines. There are 1,100 wineries but only 152 process purely vinifera. Of 80,000ha, only 10,000 are given to vinifera.

Brazilians drink 50 litres of beer and 6 litres of cachaça per head a year. The country has a large young population and 53%, or 104 million people, of the population is now deemed middle class. This is predicted to rise to 57% by 2022. The potential is there, assuming current civil unrest can be defused and demonstrators placated.

Olympic hopes

On top of these fundamental trends, next year this vast, culturally and geographically diverse country hosts the FIFA soccer World Cup and, if that wasn’t enough, two years later it holds the Olympic Games, Rio 2016. If ever there was a moment for Brazilian wine producers to make up for lost time, now, in the run-up, is it.

It seems incredible but wines from Chile and Argentina hold a larger proportion of the Brazilian wine market than Brazilian wine. There is a reciprocal trading agreement between the major South American powerhouse economies whereby Brazil exports the likes of trucks and buses to Argentina and Chile and, in return has agreed to import wine at greatly reduced import tariffs. The upshot is that imported wines are cheaper than domestic wines. 

The double whammy is that the economy only truly opened up in the mid-1990s, so restaurateurs, retailers, sommeliers and ultimately consumers believe, incorrectly, that local Brazilian wines are inferior to imported wines.

The one area of optimism is that 75% of wine consumed in Brazil is domestically produced, according to Ibravin from the Brazilian Wine Institute. From wines made by the traditional (Champagne) method to sweet, low-alcohol fizzy Moscato wines, Brazilian sparklers are world class – as are their fine wines.

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