Wine - Paraguay

The Wine market in Paraguay has been experiencing steady growth in recent years.

Customer preferences: Paraguayans have shown an increasing interest in wine, with a growing number of consumers opting for wine as their beverage of choice. This shift in preference can be attributed to several factors. Firstly, there has been a rising awareness of the health benefits associated with moderate wine consumption, such as the presence of antioxidants and potential cardiovascular benefits. Secondly, wine is often seen as a sophisticated and elegant drink, appealing to consumers who are looking for a more refined beverage option. Lastly, the growing middle class in Paraguay has led to an increase in disposable income, allowing consumers to explore new and more expensive products, including wine.

Trends in the market: One of the key trends in the Paraguayan wine market is the increasing demand for imported wines. Paraguay does not have a strong tradition of wine production, and as a result, the domestic wine industry is relatively small. This has created an opportunity for international wine producers to enter the market and cater to the growing demand. Imported wines from countries such as Argentina, Chile, Spain, and Italy are particularly popular among Paraguayan consumers. These wines are often perceived as high quality and are associated with the traditional wine-producing regions of the world. Another trend in the market is the growing popularity of red wine. Red wine has gained a strong following in Paraguay, with consumers appreciating its rich flavors and potential health benefits. Red wine is often seen as a versatile drink that can be enjoyed on its own or paired with a variety of foods. This trend has led to an increase in the availability and variety of red wines in the Paraguayan market.

Local special circumstances: Paraguay's climate and geography pose challenges to wine production. The country has a tropical climate, which is not conducive to grape cultivation. Additionally, Paraguay lacks the suitable soil conditions and vineyard infrastructure required for large-scale wine production. As a result, the domestic wine industry in Paraguay is relatively small and focused on niche markets. Local wineries often produce small quantities of wine using imported grape juice or concentrate. These wines are typically sold at higher prices compared to imported wines.

Underlying macroeconomic factors: Paraguay has experienced strong economic growth in recent years, which has contributed to the increasing demand for wine. The country's stable economy and rising middle class have led to an increase in disposable income, allowing consumers to spend more on luxury goods such as wine. Additionally, Paraguay has a young and urbanized population, which is more likely to adopt new consumption habits and embrace global trends. These factors have created a favorable environment for the growth of the wine market in Paraguay. In conclusion, the Wine market in Paraguay is developing due to changing customer preferences, including an increasing interest in wine as a beverage of choice and a growing demand for imported wines. The market is also influenced by local special circumstances, such as the country's climate and geography, which limit domestic wine production. The underlying macroeconomic factors, including strong economic growth and a rising middle class, further contribute to the development of the wine market in Paraguay.

Data coverage:
The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:
Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on alcoholic beverages, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:
The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level.