Academia de Studii Economice

Facultatea de Administrare a Afacerilor cu Predare in Limbi Straine

Engleza -

Market analysis for wines on the Romanian market

Group 111 Autori: BANICA Bogdan BELINSKII Alexander KHALIL Michel

Table of Contents
Introduction ................................................................................................ 3 1. Market capacity ...................................................................................... 4 2. Market evolution .................................................................................... 7 3. Market structure ................................................................................... 12 4. Product supply ...................................................................................... 14 5. Exports and Imports ............................................................................. 19 6. Prices and tariffs. .................................................................................. 24 7. Conclusions .......................................................................................... 26 8. Reference list ........................................................................................ 27

Introduction
The fact that Romanians like to drink wine is well known by Europeans. But they miss one aspect: Romanians, above all, are real wine growers. This is due to the geography that we live in. Of course, the geography would be worthless if we didnt take in account the talent of our viticulturists. There are several capital differences between the people living in different areas of the country, each with advantages and disadvantages. Same thing could be said about the wines coming from these certain zone: each wine is special. No wonder why the natives like to drink wine: every person has a favorite Romanian wine, sweet or dry, red or white. The Romanian viticulture goes back at least 4000 years ago. Theres a legend that states that Dionysos, the god of wine, was born in Thracia. The wine was introduced by the Greeks, in Dacia, who arrived from the Black Sea. In the middle ages, the Saxons brought different types of Germanic grapes and the wine production diversified and developed .Later, in the 1880, Phylloxera appeared in Romania, coming from North America. This insect devastated the Romanian wine cultures, along with other European cultures. This unfortunate event had a strong impact on the local viticulture, but eventually, different sorts of wines were imported from France. The Romanian wine culture was back on tracks! The general climate is continental with very hot summers and cold winters, alleviated slightly by the influence of the Black Sea, particularly in the extreme south-east. In Transylvania, west and north of the Carpathian Mountains, the altitude gives slightly cooler summers than are found elsewhere in the country. The soils are varied; they are basically stony and well-drained around the Carpathians, but more alluvial and sandy in the coastal area. Therefore, the viticulture is done on hills and well-drained slopes, having the best sun exposure. Other areas

preferred by the wine growers are the valleys that are protected against the cold winter winds and late spring frosts.1

Wines of Romania
Romania numbers among the few countries in the world that benefits of such favorable conditions for vine growing and wine making, excepting perhaps only France, which can produce such a great variety of wines. From the divine white wines of Jidvei and Cotnari to the red wines of Murfatlar in Dobrogea, Romania has always offered some of the most exciting and interesting wines in the world.

Romania - a wine country

Romania is a major European wine country with rich historic and cultural traditions, many of them directly related to this marvelous drink, rightfully considered divine liquor. Today the country builds its own future in consonance with that of the European Union and in this sense undergoes profound changes, while aspiring to become a valued member of the world wine community as a producer of highly praised quality wines. Romania is the 5th wine producer in Europe.
Place of Romania world-wide: - area under vine (6th position in the EU) - grape production (7th position in the EU) - wine production (7th position in the EU) - among the first 10 countries in the world with regard to area under vine and wine production.2

1. Market capacity
Wine market posted a total turnover of 350 million euros in 2008, while consumption is 26.6 liters per capita is expected to grow in 2009 to 30 liters per capita. 1.1 The number of potential consumers ( potential market )

http://www.wineromania.com/files/docs/romania_EN.pdf http://www.traderom.ro/prezentare%20sectoare%20economice/Vinuri%202010en.pdf

The potential consumers of wine market, represents the entire Romanian national population, who turned 18 years, plus other nationalities who, by their religion and tradition, they are allowed to drink alcohol. Most people, 18 million, according to 2002 census, are not prohibited the consumption of alcoholic beverages.

1.2 The number of effective consumers (effective market ) The effective consumers of this market are the people older than 18 years. In Romania, they are around 14 million.

1.3 Sales volume and sales value of the product ( by geographical regions/ administrative-territorial divisions/ developments regions)
The structure of the wine sales by counties in 2008 , liters of wine:

Alba Arad Arges Bacau Bihor Bistrita- Nasaud Botosani Brasov Braila Buzau Caras Severin Calarasi Cluj Constanta Covasna Dambovita Dolj Galati
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10.161.200 12.528.600 17.875.200 18.806.200 15.960.000 8.299.200 12.023.200 15.696.660 9.948.400 13.220.200 8.857.800 8.645.000 18.699.800 19.045.600 5.931.800 14.417.200 19.551.000 16.494.660

Giurigu Gorj Hargita Hunedoara Iasi Ilfov Maramures Mehedinti Mures Neamt Olt Prahova Satu Mare Salaj Sibiu Suceava Teleorman Timis Tulcea Vaslui Valcea Vrancea Bucuresti 1.4 Structure of the sales volume and value

7.982.660 10.374.000 8.671.600 12.901.000 21.705.600 7.982.660 13.568.660 8.139.600 15.430.660 14.632.660 12.770.660 22.051.400 9.762.200 6.596.800 11.198.600 18.300.800 11.597.600 18.008.200 6.836.200 12.103.000 10.985.800 10.294.200 53.226.600

In the segment of 0.75-litre bottles, the Romanian consumers prefer the white wines (about 72%), followed by the red wines (22.4%) and the ros wines (5.6%). The sales by wine type reveal the Romanians preference for the semi-sweet wines (41.9%), followed by the semi-dry wines (24.2%) and the dry wines (19.5%). The sweet wines account for 11.2% in the Romanians preferences. While in Moldavia the consumption of bottled wine in 2-litre bottles is on the top position in consumers preferences, in Transylvania the consumers prefer the wine bottled into 0.75-litre bottles.

Sales

White Wines Red Wines Ros Wines

Sales

Semi-sweet wines Semi-dry wines Dry wines Sweet wines Others

2. Market evolution
2.1. The Romanian Wine industry outlook Wine production The evolution of wine production during the period 2004-2008 was the following:

Graph 1 : Wine production, 2004 -2008 (000 hl)

By main regions, the wine production looked in 2008 as follows:

Graph 2: Wine production by main wine regions, 2008 (%)

Domestic market Currently, five big wine producers dominate the domestic market, with a common share of almost 70% in 2008, the remainder being disputed by all other Romanian and foreign wine producers present on the market.

http://www.romanian-winegrowers.com/downloads/Wine%20Industry%20Outlook_091014.pdf http://www.romanian-winegrowers.com/downloads/Wine%20Industry%20Outlook_091014.pdf

Graph 3: Main wine producers on the local market, 2008 (%)

2.2. Particularities of the Vine and Wine Market. Trends.

Graph 3: Evolution of average yearly wine consumption per capita in Romania compared to other beverages in the 5 period 1990- 2006.

Source: Romanias Statistical Yearbook, different years. The area under bearing vines had a decreasing trend, the main constraints being the extremely expensive investment for the establishment of vine plantations as well as the extremely high maintenance costs in the noble vine plantations.

ftp://ftp.repec.org/opt/ReDIF/RePEc/iag/iag_pdf/AERD0902_277-292.pdf

Source: Romanias Statistical Yearbooks. Graph 4: . Evolution of areas under bearing vines, thousand ha, in the period 20012007.

In the year 2006, the area under bearing vines totaled 190.5 thousand hectares, out of which 96.7 thousand ha under grafted vines and 93.8 thousand ha under hybrid vines. Compared to the previous year, in 2007 the areas under grafted vines decreased by 2 thousand ha, while the areas under hybrid vines increased by 1.5 thousand ha. From the point of view of the share of grafted and hybrid vines, the quality structure of vine plantations has deteriorated throughout the years: in early transition, the grafted vines accounted for 70% and the hybrid ones 30% of the area; at present, it continues to be unsatisfactory, with only 49.8% noble vines and over 50% hybrid vines; the area under wine grape vines (table grapes exclusively) accounts for 48.2% of the area under vines on bearing.

The total grape production fluctuates from one year to another, being influenced by the specific weather conditions. In the year 2007, the grape production totaled 876.6 thousand tons, out of which 58.7% were noble grapes and 41.3% hybrid grapes. The yields are higher on the noble vine plantations compared to the hybrid vines, i.e. 5435 kg/ha versus 3797 kg/ha. The main factors influencing quality are the following: structure of plantations and varieties, technology and weather conditions, the last factor influencing production quality every year.

Source: Ministry of Agriculture and Rural Development (MARD). Graph 5 : . Quality structure of wine grape production, in the year 2006.

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2.3. Market evolution The wine market has evolved upward in the period 2006-2008. In 2006 there was a growth up to 400 million euros, in 2007 it reaches 450 millions euros, and in 2008, 500 million euros. To study the wine market evolution we need to take into consideration the following indicator: the average variation rhythm of the sales value of wine during the period 2006-2008. To determine it use the following formula:
R n1 Y n 1 * 100 , where: Y 1

Y n- the sales volume in the year 2008= 500 mil; Y 1- the sales volume in 2006= 400;
n - the number of years taken into consideration =3 = (31

500 1) * 100 11 % 400

Taking into acoount the average variation rhythm of the sales value and the sales volume in 2006, 2007 and 2008, we can say that the wine market has risen slowly.

2.4. Romanian wine market in 2011

The Romanian wine market is expected to contract by more than 10% in 2011 compared to 2010, according to the Association of Vineyards and Wine Producers. The wine market in Romania last year was estimated to be worth 450m. During the period JanuaryNovember 2010, wine exports amounted to 12.7m while imports totaled 13.3m. In volume terms, the wine market in Romania totaled 6.3 million hl last year. Only around one-quarter (approximately 27%) of the wine produced in Romania is sold through official channels. The rest (over 70%) is either sold on the black market or is produced for household consumption purposes. The black market of wine causes the state budget to lose out on 100m annually. The counties of

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Vrancea, Buzau and Prahova are the main locations for black market wine sales, according to information from the Association of Vineyards and Wine Producers.6

3. Market structure
3.1. Main customer segments of the product/service market According to a local specialist, it is very difficult to make good wines because in order for them to be successful, you need to change the Romanian mentality. Fortunately the public are open to change. There is a promising market for expensive wines. Romanian people are starting to understand quality. They are tending to become foreign wine drinkers. 59% of Romanians prefer white wine and 35% red. 33% prefer medium-sweet and 21% dry. 48% like wine spritzers. Consumption of strong alcohol has decreased in favor of wine and beer. The brewery market is worth 600 million Euros and annual consumption has increased to 70 liters per person (compared to 40 liters in France). The influence of the change in buying power is also evident in the sparkling wine market, for example, consumption of French champagnes increased 95% in 2006, whilst imports of French sparkling wines declined. To define the main market segments to which wine is addressed it is necessary to analyze the market on the follwing criteria: geographic, socio-demographic, economic, psychographic and behavioral. With the help of these a profile of the wine consumer will be made. Geographically speaking, we are interested in the regions with the highest sales during last years. Moldova represents the most important area for the 0.75 liter bottled wine followed by Bucharest, Muntenia, Oltenia and Ardeal in the last place. From the point of view of value and income Bucharest is the leader. Demographically speaking the market is formed not only by physical persons but also legal persons. In romania the target market is represented by consumers who live in the urban areas with ages between 30 and 45, mainly males. Related to consumers personal income and education the targeted persons are part of the middle to high class and high studies who are part of the business area.

http://www.ceeretail.com/83986/Romanian-wine-market-expecting-decline-this-year.shtml

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Psychographically speaking the persons which are supposed to drink wine are usually open-minded, modern, outgoing, willing to gather new information and try new products. These persons drink other types of booze also and enjoy places like clubs, pubs, restaurants and coffee shops.

3.2. Consumer preferences The regular Romanian wine consumer does not only drink sweet wines with a high level of sugar and eventually mixed with coke or white wine mixed with springled water, the so-called spritz. It has been proven that the habit of wine drinking is in a continuous transition. Romanian wine drinkers have the tendancy to loosen sweet wines and drink more semi-dry and dry wines and in the same time the quantity of white wine is reduced while red ones gain more market share. With time passing the Romanian consumer prefers wines with increasing quality. The area in which the vineyard is placed usually causes some differences in preferences. For example, people who live near vineyard have the tendancy to be more attached to this particular wine which they consume a lot. Recent studies show that more than a third of the consumers prefer semi-dry wines and only one out of six prefers dry wines. Sweet and semi-sweet wines are prefered oyby more than a third of the consumers, especially women. Studies show that semi-sweet wines are enjoyed by 41.9% of the consumers, semi-dry by 24.4%, dry by 19.5% and finally 11.2% of the consumers enjoy drinking sweet wines.

3.3. Consumer behaviour Romanian people buy wines according to its price and not quality. This is why producers confirm that they are constantly suffering losses because people prefer to drink cheap, low-quality wines, the main purpose is to get euphoric and not to enjoy what they drink. When going out, socializing people prefer to drink something they do not usually drink at home. In restaurants and pubs, less than ordinary wines are consumed, but it depends on the waiter if he knows what to suggest or not to the customer.

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4. Product supply
Supply is the amount of an economic good that a producer or all producers can and are willing to sell during a period of time. We know that in Romania there are many wine producers, offering an impressive assortment, which are added and wine importers. The main Romanian bidders based on the geographical area are: In Dobrogea we meet: Murfatlar Romania, Karom Drinks, Vinvicon Constanta, Fruvimed, Viticola Sarica, Niculitel Alcovin SRL, Ovidius Mercado In Transilvania: Jidvei i Prescon Mure In Banat: Cramele Recas, SCDVV Minis. In Oltenia : Carl Reh Winery, Vie Vin Vnju Mare, Vinarte, SC Banu Mrcine, Domeniul Coroanei Segarcea. In Moldova: Bucium Iai, Cotnari, Vinia, SCDVV Iai, Vincon Vrancea, Veritas Panciu, Vinuri Nicoreti, Prowine International. In Muntenia: Provinum, S.E.R.V.E., Vinterra International, Cramele Halewood, Carpathian Winery, Videlmar, DVFR, ICDVV Valea Clugreasc. The most important producers in 2008 are: Name of producers Murfaltar Cotnari Jidvei Vincon Market share (%) 27,8 19 14,5 8 Turnover (mil. euro) 42 25 13 7

Romania ranks 11th among the world's largest wine producer, with production of 6.3 million hectoliters, and the tenth position in the consumer, with 5.4 million hl per year, according to a report by the International Organization of Vine and Wine (OIV).

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4.1. Main suppliers

VINCON
Vincon Vrancea S.A. is the biggest wine producer in Romania, with more than 50 years of experience. The company develops its activity in the region of Vrancea, the biggest winegrowing region of the country, with more than 28.000 vine cultivated hectares. This wine-growing region, with a secular tradition, includes 3 famous vineyards: Panciu, Odobesti and Cotesti. Vincon Vrancea S.A. owns 25 production unities, winecellars and grape collecting centers, that can process almost 40.000 tones of raw material in only one season. The modern technology, equipments and performing bottling lines (imported from Italy, France and Germany) give this company real possibilities of obtaining high quality wines for the home market and for export. All the noble wines obtained are the result of an oenology engineers team, of their efforts and abnegation, as well as of some famous technologists with a special training in Bordeaux-France. The traditional white wines: Galbena de Odobesti, Sarba, Feteasca Regala, Tamaioasa Romaneasca, Grasa de Moldova and the classic ones: Sauvignon Blanc, Riesling, Muscat Ottonel are very well appreciated for their quality by the Romanian consumers and by the European and Asian ones. Red wines: Cabernet Sauvignon, Merlot, Pinot Noir and Feteasca Neagra are the pride of the oenolog specialists, who, succeeded, through their talent and with the help of the most recent technology, to enable these wines to win many national and international contests. The variety range offered to the consumers is perfectly completed by a great variety of refined brandy sorts, obtained through the same method as French brandy is, being aged in 500 l oak casks for over 25 years. The brandy store (over 20.000 hl) is considered to be the largest in Europe and it is carefully kept in the special storehouse, technically named "Paradise". The most well-known original products obtained of wine distillate by VINCON VRANCEA S.A. are: Miorita, Vrancea, Extra Baron, Dorobant, Triumph, Columna, Steaua Vrancei = Vrancea`s Star and Milcov-Extra. The quality of these products was, along the years, Vincon Vrancea certified by the numerous golden medals won in professional contests.

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The old wines and the collections of selected wine bottles are, for the company, the indisputable proof of the value, tradition and quality in time of the wines that are obtained here. More than 50.000 bottles of exceptional wine are stored in the "Princely Cellar" (Beciul Domnesc) that was built during the reign of Stefan cel Mare (Steven the Great) and rearranged in 1680. The oldest collection wine carries the mark of its value and age, being stored in here since 1949.7 Most of the wines produced by VINCON VRANCEA S.A. won, along the years, gold, silver and bronze medals in the contests that the company took part in.

JIDVEI
The private trade company JIDVEI SRL is located in the Tarnave Vineyard, more precisely in the Tarnava Valley, between Tarnaveni and Blaj, at the common border of Mures and Alba counties. The vine covers over 1000 ha. Approximately 50 ha are renewed every year. The first state vineyard was founded here in 1949 and it has been gradually extended to a total area of 1000 ha. The privatisation of the viticultural, fruit-growing sectors and the wine cellar has given a new dimension of Jidvei vineyard development. The Jidvei vinery is financial healthy, as the exports grow monthly and the consumption is high. The vine plantations were established on the sunny hills on the left hand side of Tarnava Mica, sheltered from the winds, the late spring and the early autumn hoarfrosts. Vines are planted on hills with east-west exposure at an altitude of 400-450 m.8 The lands were recently consolidated and terraced. The brown forest soil enjoys a favourable climate with warm and long autumns, mild summers and winters. The average temperature is 9.9oC. In this "Sanctuary of Wine" many varieties of vine are cultivated, recognized and praised in Romania and around the world: Feteasca Regala (320 ha), Riesling (200 ha), Feteasca Alba (100 ha), Traminer (40 ha), Chardonnay (20 ha). There are also other varieties on 80 ha: Pinot Gris, Oporto and Sylvaner. The Jidvei sparkling wines are made here in Catatea de Balta chateau.

http://www.dce.gov.ro/info_business/apev/_engleza/Vincon_v/vincon/presentation.htm http://www.dce.gov.ro/info_business/apev/_engleza/Jidvei/index.htm

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COTNARI
S.C. COTNARI S.A. was founded in 1948, as a distinct department of a state-owned farm, counting at that time 128 hectares of vine plantations. In 1956, S.C. COTNARI S.A. became an independent unit. A modern plant was erected throughout 1966-1968, with a processing capacity of 500 tons of grapes in 12 hours and 10,500 tons for storage, of which 5,520 tons for maturation. Cotnari is one of the most precious jewels of all Romanian vineyards, certified in documents more than 500 years ago in 1448 where wine is made from ancient times. Located at the northern border of the Romanian wine, the COTNARI vineyard may easily be compared to the most famous vineyards in the world. Its tall hills remind of legends with a deep resonance upon the wine and its history. Cotnari, this miracle vineyard, given its geographical location at the crossroads of the coordinates 47 025 northern latitude and 26025 eastern longitude, is placed towards the northernmost limit of quality vineyards in Romania and even in Europe. The pearl of Moldavia and of the entire country, the Cotnari wine has savored by high dignitaries, kings and queens, patriarchs and bishops, and they have all appreciated its qualities with various superlatives. The natural conditions of this vineyard are favorable for special wine varieties. The calcareous soil and the wonderful effect of the noble mould (Botrytis cinerea), as well as the selective harveting of withered grapes contribute the unique quality of the Cotnari wine (D.O.C. denomination of controlled origin). Tourists may take a tour of the modern plant, of the ancient wine cellars and the Carjoaia and Paraclis castles, to the ruins of the Harlau Palace, erected during the reign of Stephen the Great (1457-1504), when the vineyard evolved significantly. COTNARI S.A. is the most important producer of the Cotnari vineyard. Located at the very heart of the vineyard, the producers name rightfully identifies with that of the vineyard, as anyone who wants to get a taste of the genuine Cotnari wine should order the wine with the bottle identification elements certifying the authenticity of the Cotnari S.A. producer. The Cotnari wine on the market currently identifies with the wine produced by Cotnari S.A., which continues the decades and centuries of tradition at the heart of this vineyard. Cotnari S.A. has focused on producing white wines, with denomination of controlled origin (D.O.C.) as well as wines with denomination of controlled origin and quality stages (DOC-CT, CMD, CIB) (late-picked, picked at the full maturity stage, picked at the seed ennobling stage).

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The vineyard varieties have always been made up of native varieties: Grasa de Cotnari, Feteasca Alba, Francusa and Tamaioasa Romaneasca (Busuioaca de Moldova), a structure established ever since the times of Stephen the Great and preserved until now. The wine produced by COTNARI S.A. is distributed both on the domestic and on international markets (Japan, Greece, the United States of America etc.). The domestic distribution network covers the entire Romanian territory. 9

MURFATLAR
RESEARCH CENTRE FOR VITICULTURE AND ENOLOGY MURFATLAR, is located in the middle of the vineyard with the same name that it is spreading on the central hilly area of the Constana County. Since more than a century, beginning with the 1907, at Murfatlar were established the first plantations for research, which were named "The nursery Murfatlar ''. The surfaces of the our vineyards have ranged from 5 hectares in 1907 until 1747 hectares in 1988. Currently, the land consists of 190 hectares of which 108 are in the property of the Academy of Agricultural Sciences and Forestry "Ghe. Ionescu iseti". High concentrations of sugars in must of the grapes, as a consequence of dry climate and the calcareous soils, created at Murfatlar the opportunity of obtaining semisweet wines and natural sweet wines, original, which were asserted easily in time, at international and national competitions. Currently, here are obtained all range of wines, dry, semidry up to sweet ones.10 The assortment consists in wines from white varieties: Chardonnay, Pinot gris, Sauvignon, Feteasc regala, Riesling Italian, Muscat Ottonel, Columna and the varieties for red wines: Pinot noir, Cabernet Sauvignon, Merlot, Feteasc Neagra and Mamaia.

4.2 Marketing Channels for Wines in Romania Wikipedia says that A marketing channel is a set of practices or activities necessary to transfer the ownership of goods, and to move goods, from the point of production to the point of consumption and, as such, which consists of all the institutions and all the marketing activities in the marketing process.11

http://www.dce.gov.ro/info_business/apev/_engleza/Cotnari/index.htm http://www.dce.gov.ro/info_business/apev/_engleza/Murfatlar/index.htm http://en.wikipedia.org/wiki/Marketing_channel

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So we can state that the marketing channel is actually the distribution system. The mechanism that brings the product, in our case, the wine, from the producer to consumers. The distribution includes human and material resources. Logically, the price of the distribution system is reflected in the price of the product. We have several types of distribution systems: 1. Large producers of grapes and wines -> Consumers or Export. This is typical for the large producers, who produce their product and also sell it. Their targets are the destinations for their product: domestic and foreign. 2. Large producers of grapes and wines -> En-gross or Export. This is typical for the large producers, who produce their product and then sell it to En-gross Retailers. Their targets are the same: domestic and foreign. 3. Small grape and wine producers ->Centers that collect grapes -> Large Wine producers -> Engross-> Consumers This is the case for small wine producers, that do not process the grapes. Their harvest is sent to a specialized center that collects grapes. This center has the equipment needed to collect, store and transport the raw materials to the larger units that actually perform the processing operations. In the end, the wine is bought by the consumers through en-gross or en-detail retailers. 4. Small grape and wine producers -> Co-operative Societies -> En-gross Retailers->Consumers Nowadays, this technique is rarely found. 5. Small grape and wine producers -> Co-operative Societies -> En-detail Retailers->Consumers In this case, en-detail retailers are used in order to sell the product. 6. Small grape and wine producers -> Own Processing -> Consumers 7. Small grape and wine producers-> Own Processing -> Own Consumption These are very short channels. The viticulturists have their own processing, storing and selling operations. They do all the work, in their household. The household production has two targets: local market and own consumption. The Romanian wine is rarely exported because it is not advertised correctly. However, another reason is the quality of the wine. This is due to the fact that 50% of the wine produced in Romania is obtained from hybrids. More than 50% of the quality wine produced in Romania is obtained from small producers who do not want to sell it. They would rather consume it themselves.

5. Exports and imports

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5.1. Wine Exports In 2008, Romanian wine exports reached a level of 138 thousand hl, in value of 24.1 million US$. Quantitatively, the exports remained stagnant, but value-wise they showed an increase which meant a growing average value (US$/liter).

Romanian wine exports, 200-2008(000 hl)

Romanian wine exports, 200-2008 ( mio US$)

By main destinations, Romanian wine exports in 2008 presented as follows:

Romanian wine exports by main countries of destination, 2008 (%) An interesting feature, worthwhile mentioning, is that Romanias Intra-EU wine trade held in 2008 a share of 74.4% in quantitative terms and of 65.4% in value terms, the difference being shared by over 33 third countries around the globe.
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At the same time, the top ten countries of destination held in 2008 a share of 88.3% in quantitative terms and of 85.1% in value terms.12

In 2009, the wine exports during the first five months presented as follows: Romania: wine export Jan-May 2009 Geographical Orientation Jan-May 2009 (%)

V ROMA IA 5.2. Wine Imports In 2008, Romanian wine imports reached a level of 384.3 thousand hl, in value of 54.6 million US$, meaning a slight increase in quantity terms, while in value terms the growth was more pronounced. The explanation is rather simple, since the import in 2006 consisted mainly in cheap bulk wines imported to compensate the losses recorded in 2005, while beginning with 2007 the imports of bottled wines of higher quality became ever more manifest.

During the period 2000-2008 the wine imports evolution of Romania looked as follows:

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http://www.romanian-winegrowers.com/downloads/Wine%20Industry%20Outlook_091014.pdf

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Romanian wine imports, 2000-2008 (000 hl)

Romanian wine imports, 2000-2008 (mio US$)

By main countries of origin, Romanias wine imports in 2008 are presented below:

Romania: wine imports by main countries of origin, 2008 (%)

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In 2009, the wine imports presented as follows:

Romania: wine imports Jan-May 2009

Geographical Orientation Jan-May 2009 (%)

6. Prices and tariffs

6.1. Identifying the price segments The behavior of wine distribution companies is not subject to price stability established by regulated competitive market requirements. For some brands, the price is above the level of competition and market, as it is for the segment of the population with high income and high demands. Products on the wine market have a price disparity compared with the ones in the vine domain

In general, price differences refer to all respects: - the production regions - white and red wines - wines classified as high quality.

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In conclusion, it is difficult to make an overall assessment of the differences of prices in the wine, especially if we consider "quality wines", which can reach spectacular price levels, while some types of table wines can not find a market place despite relative low prices. Quality is a primary criterion for the Wine Marketing Policy. Classifying wines in table wines and high quality wines expressed the differences in the consumers behavior and often shows the diverging trends in the evolution of consumption. 6.2. Determination of price changes in the last five years and the reasons underlying these variations The price of a liter of table wine in 2005 was 2.5 lei, and of the quality wine 7.0 lei. Production in 2005 was very poor, about half of what in a normal year should be. This meant small stocks in cellars, and higher prices of Romanian wine. These prices can not be immediately transmitted to consumers. At this moment in Romania, about 70-80% of Romanian wines in the supermarket are more expensive than 60% of wines in supermarkets in Germany. During 2006-2008 prices have increased slightly, due to good production recorded. But buyers paid on average 10-15% more for varieties of Romanian wines, towards producers selling price. Thus, buyers pay about 0.5 - 3 lei more for wine, if they are buying from the big commercial networks.

Case study : Price of Jidvei wine in supermarkets According to representatives of Jidvei wine producer, the company supplying the commercial networks with types of wine Feteasc Regala (dry), Dry Riesling (dry) and Sauvignon Blanc (dry) at a price of 14.28 lei. In Kaufland store chains, the prices of assortment of wine are higher with 1.71 lei, reaching 15.99 lei, while the units Carrefour sells Feteasca Regala 15.85 lei, Riesling Dry with 14.86 lei and Sauvignon Blanc with 14.70 lei. In Cora hypermarkets, Sauvignon Blanc is sold at 15.99 lei. Jidvei Gewurtztraminer wine(medium dry) is marketed by the producer at price of 14.84 lei and arrive at 16.89 lei in Kaufland network, and it sells in Cora hypermarkets at 16.72 lei. Muscat Ottonel (medium sweet) from Jidvei receives in Carrefour stores, an addition of 0.58 lei. An added greater is recorded at assortment Tezaur Jidvei - Muscat Ottonel & Feteasc Regala. Kaufland offers 3 lei over the price of the producer, and Carrefour hypermarkets added 1.11 lei. The assortment goes from producer to 19.99 lei. Also according to the price list provided by Cotnari assortment Grasa de Cotnari 2005 (sweet) and Tamaioasa Romaneasca 2005 (sweet), marketed by the producer with 14 RON, will be sold in Kaufland at the price of 15.99 lei.

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In addition, the same shops, Francusa 2008 (dry) retails for 12.99 lei from 11.95 lei as is producer price, Feteasca Alba 2007 (semidry) is solded with 10.95 lei from 10.45 lei, and wine "Casa de piatra" 2007 (semidry) is sold with the addition of 1 leu.13

7. Conclusions

13

http://www.scribd.com/doc/50191654/piata-vinurilor-mrk

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Reference list
1. http://www.wineromania.com/files/docs/romania_EN.pdf

2. http://www.traderom.ro/prezentare%20sectoare%20economice/Vinuri%202010en.pdf

3. http://www.romanian-winegrowers.com/downloads/Wine%20Industry%20Outlook_091014.pdf

4. ftp://ftp.repec.org/opt/ReDIF/RePEc/iag/iag_pdf/AERD0902_277-292.pdf

5. http://www.ceeretail.com/83986/Romanian-wine-market-expecting-decline-this-year.shtml

6. http://www.dce.gov.ro/info_business/apev/engleza/Vincon_v/vincon/presentation.htm

7. http://www.dce.gov.ro/info_business/apev/_engleza/Jidvei/index.htm

8. http://www.dce.gov.ro/info_business/apev/_engleza/Cotnari/index.htm

9. http://www.dce.gov.ro/info_business/apev/_engleza/Murfatlar/index.htm
10. http://en.wikipedia.org/wiki/Marketing_channel

11. http://www.scribd.com/doc/50191654/piata-vinurilor-mrk

12. http://www.ann.ugal.ro/tpa/Anale%202010/vol%201/Full%20paper%20GIordachescu.pdf

13. http://www.wine-pages.com/features/romanian-wine.htm

14. http://www.winealley.com/dossier_49867_en.htm

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