Sauvignon Blanc and Pinot on the Rise in U.S.

Pinot Noir, Sauvignon Blanc and Cabernet Sauvignon remain in demand.

By W. Blake Gray February 10, 2015
Chardonnay is still king of the U.S. wine market, but its sales were flat in 2014 for the first time in years, according to Nielsen.

Meanwhile, New Zealand continued a long trend of growth in the U.S. wine market and Portugal joined the party, while wines from Australia and Germany plummeted.

The hottest varietal wines last year in the food and drug stores measured by Nielsen were Sauvignon Blanc, Pinot Noir and Cabernet Sauvignon.

But the hottest wine type overall was the domestic red blend, which grew 11.7 percent by volume. "Red blends" as a category are now the fourth-largest seller, after Chardonnay, Cabernet Sauvignon and Pinot Grigio.

This will probably continue in 2015 because 41 percent of all new wines on the market last year were red blends. But Nielsen senior vice president Danny Brager said unlike the Moscato surge of a few years ago, red blends are not bringing more people to wine. Instead, consumers are buying red blends instead of other wines, particularly Merlot, which had the largest drop in sales of any varietal. This is ironic because many red blends have big percentages of Merlot; it's the same juice with a new name.

If you thought there was no more room for more Cabernet, the wine industry disagrees with you, as 9.5 percent of all new wines on the market last year were Cabs.

Sales for Shiraz continued to plummet, down 14.5 percent by volume. Riesling and Zinfandel also dropped.

Moscato and Malbec, previously two of the hottest varietals, continued to grow but at a slower pace.

Among imported wines, 2014 was a bad year for Spanish-speaking countries in the U.S. market. Wines from Spain, Chile and Argentina each dropped about 2 percent by volume. For Argentina, this is noteworthy after many years of strong growth.

As for Portugal, it is only the 10th-largest supplier to the U.S. but its wines grew 9.9 percent by volume and 13.4 percent by value, putting it within reach of passing South Africa (which also had a decent year) to move into ninth place.

Millennials are important to the import market because they buy more imports as a percentage of all wine purchased than baby boomers. Millennials are driving the growth in Portugal and are also the main purchasers of wine from Greece, Austria and South Africa.

About the only wine-producing country that millennials and baby boomers buy with the same frequency is Australia, which must be looking for good news after another terrible year in the U.S. wine market. Australia lost 7.2 percent in sales by both volume and value, the biggest net losses of any country. Moreover, its wines were rated the lowest in quality among the 12 top import countries in a Wine Market Council poll of high frequency wine drinkers.

A little warning sign for France - while its wines were rated second-highest in quality behind Italy in the same poll, they came in the lowest-rated for value. Italy also had a large gap between perceived quality and perceived value.

The average price for a 750ml bottle of wine in Nielsen-measured stores hit a record $9.41 in 2014, and could reach $10 by the end of 2015, Brager said.