Required Report - public distribution

**Date:** 2/08/2006

**GAIN Report Number:** SP6006

PO0000

**Spain**

**Wine**

**Annual**

**2006**

**Approved by:**

![](media/image1.wmf)Stephen Hammond

U.S. Embassy

**Prepared by:**

Leonor Ramos

**Report Highlights:**

Spain\'s wine exports during marketing year (MY) 2005/06 (September to
August) will likely be off recent year's levels by at least half a
million hectoliters. The decrease is due to a drought-reduced grape
harvest. However, the resulting quality of this year's vintage may be
one of the best in recent years. (LR70SH5)

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Unscheduled Report

Madrid \[SP1\]

\[SP\]

######### TABLE OF CONTENTS

[**Executive Summary 3**](#executive-summary)

[Production, Supply & Distribution Table
4](#production-supply-distribution-table)

[Production 4](#production)

[General 4](#general)

[Production Policy 5](#production-policy)

[Consumption 8](#consumption)

[Trade 10](#trade)

[General 10](#general-1)

[Trade Matrices 17](#trade-matrices)

[Policy 18](#policy)

[Import Tariffs 18](#import-tariffs)

[Marketing 19](#marketing)

# Executive Summary

-   The drought in Spain (please see SP5004, SP5013, and SP5024 for more
    information), beginning before, and lasting during the entire
    grape-growing season has meant reduced grape production and a
    resulting decrease in MY 2005/06 wine production and subsequent
    exports. We expect that wine exports will decline to about 13.5
    million hectoliters (MH) during MY 2005/06, down from 14.1 MH in MY
    2004/05. From that total, only some 3.5 MH will be exported to
    non-EU countries.

-   While the quantity of wine produced this year is off the tremendous
    pace of the last several years, many local wine experts expect that
    this year's wine production will be one of the highest-quality
    vintages of recent years. New wine from this year's production is
    now available in local stores, but will only begin to show its true
    potential as it matures through the "Crianza", "Reserva," and "Grand
    Reserva" stages.

-   Competition in the Spanish market place for wine sales is fierce
    with a great depth of choice in every price range and from each
    producing region. Spanish wines must also compete with imported "new
    world" and "old world" wines. For those that don't make the cut,
    there is always the wine alcohol tender, which is an attempt remove
    some of the excess, poorer-quality wine and spirits from the
    marketplace.

-   The competition means that Spanish producers have had to improve
    their wines. To help them do so, the European Commission (EC), in
    conjunction with the Government of Spain (GOS) and the local
    Autonomous Regional Governments (ARGs) have afforded grape growers
    taxpayer-funded subsidies to replant and improve grape production
    (please see SP5035 for additional information). As a result of the
    assistance, we expect that Spanish wine production will increase and
    improve over the next few years.

-   Improved wines, and a strong international marketing effort will
    likely help improve prospects for Spanish vintners in the world
    market. The North American market is a particular focus, and it
    appears that Spanish efforts to market to U.S. consumers are paying
    off as exports grow at a strong and steady pace. We expect the
    marketing focus and subsequent results to continue as U.S. consumers
    become more familiar with Spanish wines. But, it doesn't stop there,
    because Spanish vintners are also focusing on emerging markets, like
    those in Asia.

-   The EC is looking to reform the European wine Common Market Policy
    (CMO) in 2006. Spanish producers oppose the type of change they have
    seen in many of the other agricultural sectors, including a move to
    subsidy decoupling and the single farm paymnet.

# Production, Supply & Distribution Table

+-------------------+-------+-------+-------+-------+-------+-------+
| **PSD Table**     |       |       |       |       |       |       |
+-------------------+-------+-------+-------+-------+-------+-------+
| **Country**       | **Sp  |       |       |       |       |       |
|                   | ain** |       |       |       |       |       |
+-------------------+-------+-------+-------+-------+-------+-------+
| **Commodity**     | **W   |       |       |       | (1000 |       |
|                   | ine** |       |       |       | MT)   |       |
|                   |       |       |       |       | (1000 |       |
|                   |       |       |       |       | HL)   |       |
+-------------------+-------+-------+-------+-------+-------+-------+
|                   | 2003  | Re    | 2004  | Est   | 2005  | For   |
|                   |       | vised |       | imate |       | ecast |
+-------------------+-------+-------+-------+-------+-------+-------+
|                   | USDA  | Post  | USDA  | Post  | USDA  | Post  |
|                   | Off   | Est   | Off   | Est   | Off   | Est   |
|                   | icial | imate | icial | imate | icial | imate |
|                   | \[    |       | \[    |       | \[    |       |
|                   | Old\] | \[    | Old\] | \[    | Old\] | \[    |
|                   |       | New\] |       | New\] |       | New\] |
+-------------------+-------+-------+-------+-------+-------+-------+
| **Market Year     |       | 09    |       | 09    |       | 09    |
| Begin**           |       | /2003 |       | /2004 |       | /2005 |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Grape Crush | 0     | 6,961 | 0     | 6,980 | 0     | 5,634 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Begin Stock (Ctrl | 0     | 2     | 0     | 2     | 0     | 2     |
| App)              |       | 2,940 |       | 3,797 |       | 5,290 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Begin Stock       | 0     | 8,145 | 0     | 1     | 0     | 1     |
| (Other)           |       |       |       | 0,252 |       | 2,712 |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Beginning   | 0     | 3     | 0     | 3     | 0     | 3     |
| Stocks            |       | 1,085 |       | 4,049 |       | 8,002 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Prod. from Wine   | 0     | 4     | 0     | 4     | 0     | 3     |
| Grapes            |       | 0,365 |       | 1,906 |       | 3,296 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Prod. from Tabl   | 0     | 4     | 0     | 5     | 0     | 4     |
| Grapes            |       |       |       |       |       |       |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL PRODUCTION  | 0     | 4     | 0     | 4     | 0     | 3     |
|                   |       | 0,369 |       | 1,911 |       | 3,300 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Intra-EU Imports  | 0     | 262   | 0     | 313   | 0     | 320   |
+-------------------+-------+-------+-------+-------+-------+-------+
| Other Imports     | 0     | 18    | 0     | 22    | 0     | 25    |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Imports     | 0     | 280   | 0     | 335   | 0     | 345   |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL SUPPLY      | 0     | 7     | 0     | 7     | 0     | 7     |
|                   |       | 1,734 |       | 6,295 |       | 1,647 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Intra-EU Exports  | 0     | 1     | 0     | 1     | 0     | 1     |
|                   |       | 1,731 |       | 1,093 |       | 0,000 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Other Exports     | 0     | 2,607 | 0     | 3,000 | 0     | 3,500 |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Exports     | 0     | 1     | 0     | 1     | 0     | 1     |
|                   |       | 4,338 |       | 4,093 |       | 3,500 |
+-------------------+-------+-------+-------+-------+-------+-------+
| Dom.Consump(Cntrl | 0     | 3,500 | 0     | 3,700 | 0     | 3,800 |
| App)              |       |       |       |       |       |       |
+-------------------+-------+-------+-------+-------+-------+-------+
| D                 | 0     | 1     | 0     | 2     | 0     | 2     |
| om.Consump(Other) |       | 9,847 |       | 0,500 |       | 0,000 |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL             | 0     | 2     | 0     | 2     | 0     | 2     |
| Dom.Consumption   |       | 3,347 |       | 4,200 |       | 3,800 |
+-------------------+-------+-------+-------+-------+-------+-------+
| End Stocks (Cntrl | 0     | 2     | 0     | 2     | 0     | 2     |
| App)              |       | 3,797 |       | 5,290 |       | 2,500 |
+-------------------+-------+-------+-------+-------+-------+-------+
| End Stocks        | 0     | 1     | 0     | 1     | 0     | 1     |
| (Other)           |       | 0,252 |       | 2,712 |       | 1,847 |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL Ending      | 0     | 3     | 0     | 3     | 0     | 3     |
| Stocks            |       | 4,049 |       | 8,002 |       | 4,347 |
+-------------------+-------+-------+-------+-------+-------+-------+
| TOTAL             | 0     | 7     | 0     | 7     | 0     | 7     |
| DISTRIBUTION      |       | 1,734 |       | 6,295 |       | 1,647 |
+-------------------+-------+-------+-------+-------+-------+-------+

# Production

## General

SPAIN: Wine Production (Units: 1,000 Hectoliters)

+----------------------------------+-----------+-----------+-----------+
| **Products**                     | **Red and | **White** | **TOTAL** |
|                                  | Rose**    |           |           |
+----------------------------------+-----------+-----------+-----------+
| ###### Marketing Year: 2003/04   |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| TABLE WINES                      |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| Without Geographic Indication    | 9,152     | 14,682    | 23,834    |
+----------------------------------+-----------+-----------+-----------+
| With Geographic Indication       | 3,183     | 620       | 3,803     |
+----------------------------------+-----------+-----------+-----------+
| VQPRD                            | 8,297     | 4,418     | 12,715    |
+----------------------------------+-----------+-----------+-----------+
| Other Wines                      | 10        | 7         | 17        |
+----------------------------------+-----------+-----------+-----------+
| **TOTAL \-\-\--**                | *         | *         | *         |
|                                  | *20,642** | *19,727** | *40,369** |
+----------------------------------+-----------+-----------+-----------+
| **Marketing Year: 2004/05**      |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| TABLE WINES                      |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| Without Geographic Indication    | 10,644    | 14,921    | 25,565    |
+----------------------------------+-----------+-----------+-----------+
| With Geographic Indication       | 1,794     | 566       | 2,360     |
+----------------------------------+-----------+-----------+-----------+
| VQPRD                            | 9,021     | 4,965     | 13,986    |
+----------------------------------+-----------+-----------+-----------+
|                                  |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| ####### TOTAL \-\-\--            | *         | *         | *         |
|                                  | *21,459** | *20,452** | *41,911** |
+----------------------------------+-----------+-----------+-----------+
| **Marketing Year: 2005/06**      |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| TABLE WINES                      |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| Without Geographic Indication    | 9,441     | 11,538    | 20,979    |
+----------------------------------+-----------+-----------+-----------+
| With Geographic Indication       | 499       | 167       | 666       |
+----------------------------------+-----------+-----------+-----------+
| VQPRD                            | 7,576     | 4,079     | 11,655    |
+----------------------------------+-----------+-----------+-----------+
|                                  |           |           |           |
+----------------------------------+-----------+-----------+-----------+
| ####### TOTAL \-\-\--            | *         | *         | *         |
|                                  | *17,516** | *15,784** | *33,300** |
+----------------------------------+-----------+-----------+-----------+

Source: MAPYA/FEGA Declared Productions for MY 2003/04 and 2004/05, and
FAS/Iberia estimate for MY 2005/06, based on MAPYA production
statistics.

**Spain: Wine & Must Production (1,000 MT)**

+---------------------+------------+------------+------------+--------+
| **Marketing Year:** | **2003**   | **2004**   | **2005**   | *      |
|                     |            |            |            | *Share |
|                     |            |            |            | in     |
|                     |            |            |            | Total  |
|                     |            |            |            | (%)**  |
+---------------------+------------+------------+------------+--------+
| **Province:**       |            |            |            |        |
+---------------------+------------+------------+------------+--------+
| Castilla-Mancha     | 25,528     | 26,300     | 21,255     | 53.5   |
+---------------------+------------+------------+------------+--------+
| Extremadura         | 4,621      | 4,068      | 3,311      | 8.3    |
+---------------------+------------+------------+------------+--------+
| Cataluna            | 3,692      | 4,045      | 2,749      | 7.2    |
+---------------------+------------+------------+------------+--------+
| C. Valenciana       | 3,500      | 2,711      | 2,314      | 5.6    |
+---------------------+------------+------------+------------+--------+
| La Rioja            | 2,236      | 2,427      | 2,100      | 5.3    |
+---------------------+------------+------------+------------+--------+
| Andalucia           | 1,900      | 2,080      | 1,165      | 2.9    |
+---------------------+------------+------------+------------+--------+
| Galicia             | 1,785      | 1,912      | 1,482      | 3.7    |
+---------------------+------------+------------+------------+--------+
| Castilla y Leon     | 1,721      | 1,870      | 1,682      | 4.0    |
+---------------------+------------+------------+------------+--------+
| Aragon              | 1,193      | 1,629      | 1,119      | 2.8    |
+---------------------+------------+------------+------------+--------+
| Navarra             | 933        | 1,232      | 892        | 2.3    |
+---------------------+------------+------------+------------+--------+
| R. de Murcia        | 698        | 609        | 609        | 1.5    |
+---------------------+------------+------------+------------+--------+
| Madrid              | 642        | 277        | 239        | 0.7    |
+---------------------+------------+------------+------------+--------+
| Pais Vasco          | 637        | 706        | 623        | 1.6    |
+---------------------+------------+------------+------------+--------+
| All Other .......   | 253        | 196        | 210        | 0.4    |
+---------------------+------------+------------+------------+--------+
| ##                  | **49,339** | **50,062** | **39,750** | 100.0  |
| #### TOTAL ........ |            |            |            |        |
+---------------------+------------+------------+------------+--------+

Source: MAPYA

-   There are 60 Denominations of Origin recognized by the Spanish
    Government. Producers have been developing quality wines with origin
    denomination and other wines with geographical indications (GI).
    However, non-GI table wine production continues to account for the
    bulk of production. For production breakout, please check wine
    production table above.

```{=html}
<!-- -->
```
-   There are over 5,000 wineries and around 16,000 wine products,
    however, the five largest wineries produce about 40 percent of the
    wine. Add the next five and you have 60 percent of the production.

## Production Policy

-   Spanish wine production is subject to the EC CMO. Applicable
    legislation is laid out in the following:

    -   Real Decreto 1472-2000, dated August 4, which regulates the wine
        production;

    -   EU Reg 1622/2000;

    -   EU Reg. 1623/2000;

    -   EU Reg. 1607/2000; and,

    -   EU Reg. 1608/2000.

-   Spanish application of the EU legislation is located in the *Ley de
    la Viña y el Vino*, published in BOE on July 11, 2003. The Spanish
    Ministry of Agriculture (MAPYA) has announced it is revising this
    legislation shortly, but may delay revision until it can incorporate
    changes resulting from the new EU wine CMO.

-   Spanish producers have expressed opposition to introduction of
    subsidy decoupling under new wine CMO. The Cooperatives
    Confederation (CCAE) advocates a combination of horizontal measures
    to be implemented in all of the EU, with measures to be implemented
    with flexibility at individual member state level. The latter would
    include sector restructuring, quality enhancement, additional
    marketing, etc.

-   Current wine CMO includes a series of supports to curb surpluses,
    including alcohol distilling and wine storage subsidies, wine
    promotion and export subsidies. Below please find tables with latest
    official public information on subsidies directed to these programs.

-   Export subsidies have played a key role in exporting about 1.5 MH
    annually. The EC is phasing out export subsidies by 2013. On January
    16, 2006, export restitutions were reduced 0.0614 €/liter for red
    wine with 11-13 percent alcohol from 0.0682 €/liter. This is the
    second reduction carried out by the EC since the beginning of the MY
    2005/06.

-   Spanish wine exports also benefit from marketing activities carried
    out by the Spanish foreign trade institute (ICEX). These include
    participation in specialty shows abroad, development of market
    researches and other international marketing activities.

-   Further, MAPYA is developing a consortium with CCAE, with the
    purpose of carrying out activities to develop international markets.

Spain: Distilling and Private Storage Subsidies Paid in MY 2004/05

  ------------------------------------ -------------------------- ----------- -------- ----------------------
                                       **2004/05**                                     

                                                                                       **[Hl (%
                                                                                       Vol.)]{.underline}**

                                                                                       

  **[Support to Private Alcohol        **[Alcohol                 \- Brandy            17,025,895
  Storage for                          Type:]{.underline}**                            
  Distilling]{.underline}**                                                            

  (non mandatory; Article 29 \-- Reg                              \-                   1,747,556
  (CE) 1493/99)                                                   *Holanda*            

                                                                  \-                   4,320,214
                                                                  Distilled            

                                                                  \- Neutral           3,036,925

                                                                  **Total              **26,130,590**
                                                                  ....**               

                                                                                       

  **[Contracts and Authorization for   **[Num. of                                      **[Hl
  Emergency distilling]{.underline}**  Contracts]{.underline}**                        Wine]{.underline}**

  (Voluntary; Article 30 -- Reg. (CE)                                                  
  1493/99, opened                                                                      

  by Reg. (CE) 762/2005                                           1,016                3,998,067

                                                                                       

                                                                  1,013                5,350,201

                                                                                       

  **[Max. authorized Hl under Reg.                                                     4,000,000
  (CE) 762/2005]{.underline}**                                                         

                                                                                       

  **[Distilling of \"Alcohol de                                   1,432                6,594,513
  boca\"]{.underline}**                                                                

  (Article 29 of Reg 1493/99)                                                          

                                                                                       

                                                                                       

  **[Contracts to Support Private                                                      
  Storage of Table Wine &                                                              
  Musts]{.underline}**                                                                 

                                       Table Wine                                      4,298,740

                                       Must                                            3,752,551

                                       Concentrated Must                               90,013

                                       Conc., rectified must                           27,611
  ------------------------------------ -------------------------- ----------- -------- ----------------------

Source: MAPYA

  -----------------------------------------------------------------------
  **Spain: EU-Financed Wine Promotion Activities in 2003**

  -----------------------------------------------------------------------

+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
| Product/  | Entity  | **Eu  |   |      |     |     |   | **Actions**      |
|           |         | ros** |   |      |     |     |   |                  |
| R         |         |       |   |      |     |     |   |                  |
| egulation |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         | EU    |   | MAPA | Sec | To  |   |                  |
|           |         | Su    |   |      | tor | tal |   |                  |
|           |         | pport |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
| ##        |         |       |   |      |     |     |   |                  |
| #### Prom |         |       |   |      |     |     |   |                  |
| otion in  |         |       |   |      |     |     |   |                  |
| Third Cou |         |       |   |      |     |     |   |                  |
| ntries \- |         |       |   |      |     |     |   |                  |
| - Regulat |         |       |   |      |     |     |   |                  |
| ion (CE)  |         |       |   |      |     |     |   |                  |
| 2879/2000 |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
| European  | FE      | 2     | 7 |      | 7.  | 1   |   | Joint French and |
| Quality   | DEJEREZ | 2.866 | . |      | 622 | 52. |   | Spanish          |
| Wines     |         |       | 6 |      |     | 440 |   | activities       |
|           |         |       | 2 |      |     |     |   | carried out in   |
|           |         |       | 2 |      |     |     |   | Japan.           |
|           |         |       |   |      |     |     |   | Activities       |
|           |         |       |   |      |     |     |   | included: (a)    |
|           |         |       |   |      |     |     |   | Seminars in      |
|           |         |       |   |      |     |     |   | cooker schools;  |
|           |         |       |   |      |     |     |   | (b) Publicity in |
|           |         |       |   |      |     |     |   | Restaurant       |
|           |         |       |   |      |     |     |   | magazines; (c)   |
|           |         |       |   |      |     |     |   | Presentations of |
|           |         |       |   |      |     |     |   | European wines.  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
| European  | AMITON  | 57    | 1 |      | 1   | 9   |   | Joint French and |
| Quality   |         | 0,000 | 9 |      | 90, | 50, |   | Spanish          |
| Wines     |         |       | 0 |      | 000 | 000 |   | activities       |
|           |         |       | , |      |     |     |   | carried out in   |
|           |         |       | 0 |      |     |     |   | the EU.          |
|           |         |       | 0 |      |     |     |   | Activities       |
|           |         |       | 0 |      |     |     |   | included: (a)    |
|           |         |       |   |      |     |     |   | Seminars/wine    |
|           |         |       |   |      |     |     |   | tasting; (b)     |
|           |         |       |   |      |     |     |   | Promotion in     |
|           |         |       |   |      |     |     |   | Restaurants and  |
|           |         |       |   |      |     |     |   | points of sale;  |
|           |         |       |   |      |     |     |   | (c)              |
|           |         |       |   |      |     |     |   | Presentations of |
|           |         |       |   |      |     |     |   | European wines.  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
| ######    |         |       |   |      |     |     |   |                  |
| Promotion |         |       |   |      |     |     |   |                  |
|  in the E |         |       |   |      |     |     |   |                  |
| U Market  |         |       |   |      |     |     |   |                  |
| \-- Regul |         |       |   |      |     |     |   |                  |
| ation (CE |         |       |   |      |     |     |   |                  |
| ) 94/2002 |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
| Wine      | CEV     | 36    |   | 121  | 1   | 6   |   | \(a\)            |
|           |         | 4,727 |   | ,575 | 21, | 07, |   | Information in   |
|           |         |       |   |      | 575 | 877 |   | points of sales; |
|           |         |       |   |      |     |     |   | (b) Lectures to  |
|           |         |       |   |      |     |     |   | advisors and     |
|           |         |       |   |      |     |     |   | consumers; (c)   |
|           |         |       |   |      |     |     |   | Web page; (d)    |
|           |         |       |   |      |     |     |   | Press office.    |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
| Cava      | I       | 39    |   | 130  | 1   | 6   |   | \(a\) Seminars   |
|           | nstitut | 1,107 |   | ,369 | 30, | 51, |   | in Restaurant    |
|           | del     |       |   |      | 369 | 845 |   | schools; (b) Web |
|           | Cava    |       |   |      |     |     |   | page; (c) Road   |
|           |         |       |   |      |     |     |   | show; (d) Press  |
|           |         |       |   |      |     |     |   | trips.           |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+
|           |         |       |   |      |     |     |   |                  |
+-----------+---------+-------+---+------+-----+-----+---+------------------+

# Consumption

Spain: CY-2005 Wine Consumption Indicators:

Variation of Jan/to Sept 2005 Relative to Jan/Sept 2004

  ------------------- ------------ ------------------------ ----------------
                      **At Home**  **Hotels/Restaurants**   **Total**

                      \% Increase                           
                      (Jan/Sept                             
                      2005 over                             
                      Jan/Sept                              
                      2004)                                 

  Quality wine        9.6 %        17.7 %                   15.4 %

  Table wine          \- 5.9 %     \- 17.6 %                \- 12.7 %

  Sparkling Wine      2.1 %        22.8 %                   12.7 %

  Other wines         \- 2.2 %     \- 5.4 %                 \- 3.2 %

  Total               \- 2.4 %     \- 5.0 %                 \- 4.0 %
  ------------------- ------------ ------------------------ ----------------

Source: MAPYA

**Spain: Wine Consumption (Units: Hectoliters)**

  ----------------- ------------- ---------- ------------- --------- -----------
                    **CY-2003**              **CY-2004**             **2004/03
                                                                     Increase
                                                                     (%)**

                    **At Home**   **% in     **At Home**   **% in    
                                  Total**                  Total**   

  Quality wine      892,600       17.8       1,038,400     21.5      16.3

  Table wine        3,686,000     73.3       3,278,200     67.8      -11.1

  Sparkling Wine    240,900       4.8        259,300       5.4       7.6

  Other wines       208,300       4.1        257,500       5.3       23.6

  Total             5,027,800     100.0      4,833,400     100.0     -3.9

                    **Outside     **% in     **Outside     **% in    
                    Home**        Total**    Home**        Total**   

  Quality wine      2,158,700     33.0       2,428,600     34.0      12.5

  Table wine        4,019,700     61.5       4,404,200     61.6      9.6

  Sparkling Wine    224,400       3.4        198,200       2.8       -11.7

  Other wines       137,700       2.1        113,400       1.6       -17.6

  Total             6,540,500     100.0      7,144,400     100.0     9.2

                    **Total**     **% in     **Total**     **% in    
                                  Total**                  Total**   

  Quality wine      3,051,300     26.4       3,467,000     28.9      13.6

  Table wine        7,705,700     66.6       7,682,400     64.1      -0.3

  Sparkling Wine    465,300       4.0        457,500       3.8       -1.7

  Other wines       346,000       3.0        370,900       3.1       7.2

  Total             11,568,300    100.0      11,977,800    100.0     3.5
  ----------------- ------------- ---------- ------------- --------- -----------

Source: MAPYA

**Spain: Value Spent in Wine (Million Euros)**

  --------------------------------- -------------- -------------- ---------
                                    CY-2003        CY-2004        \% Inc.
                                                                  04/03

  At home                                                         

  Quality wine                      304.75         368.55         20.9

  Table wine                        364.51         327.42         -10.2

  Sparkling Wine                    118.13         120.94         2.4

  Other wines                       60.98          73.19          20.0

  Total                             848.37         890.1          4.9

  Outside Home                                                    

  Quality wine                      893.47         1,171.54       31.1

  Table wine                        514.38         583.42         13.4

  Sparkling Wine                    111.78         103.04         -7.8

  Other wines                       54.39          46.96          -13.7

  Total                             1,574.02       1,904.96       21.0

  Total                                                           

  Quality wine                      1,198.22       1,540.09       28.5

  Table wine                        878.89         910.84         3.6

  Sparkling Wine                    229.91         223.98         -2.6

  Other wines                       115.37         120.15         4.1

  Total                             2,422.39       2,795.06       15.4

                                                                  

  Total Food Expenses               69,406.19      74,752.09      7.7
  --------------------------------- -------------- -------------- ---------

Source: MAPYA

**Spain: Per capita consumption (Liter/Year)**

  ------------------------------------ ---------------- -----------------
                                       **CY-2004**      **CY-2005**

  VINO VCPRD                           8.2              8.6

  VINO DE MESA                         18.2             15.6

  ESPUMOSO Y CAVAS                     1.1              0.8

  OTHER WINES                          0.9              0.8

  TOTAL ....                           **28.4**         **25.8**
  ------------------------------------ ---------------- -----------------

Source: MAPYA for 2004, and FAS/Iberia estimate for 2005.

-   Wine consumption in Spain has been decreasing now for over the past
    15 years, with an occasional upward blip as occurred in CY 2004,
    from over 40 liters per capita/year in the mid-80s to just 26 as
    noted in the table above. Spaniards are drinking, but have been
    switching to beer, and soft drinks, etc. The young seem to be the
    least impressed with Spanish wines.

-   For latest official consumption statistics, please check tables
    above from MAPYA. Note that these statistics are prepared based on a
    sampling process, and are focused on domestic wine.

# Trade

## General

**Spain: Total Wine Imports (Units: Hectoliters)**

  --------------------- -- --------------- ------------- ------------- ------------- ------------- -------------
  **Partner Country**      **Units:                                                                
                           Hectoliters**                                                           

                           **2000 **       **2001 **     **2002 **     **2003 **     **2004 **     **2005**

                                                                                                   

  **Total**                **642,336**     **251,861**   **260,684**   **289,084**   **290,428**   **335,500**

                                                                                                   

  **From U.S.**            **680**         **319**       **215**       **283**       **422**       **500**

                                                                                                   

  **From EU**              **632,423**     **234,774**   **246,481**   **273,066**   **269,039**   **315,000**

  . Italy                  428,390         101,840       67,288        104,776       144,227       162,000

  . France                 117,106         79,789        75,557        39,294        36,657        54,000

  . Portugal               70,199          37,011        66,814        105,879       60,147        63,000

  . Germany                6,791           10,044        15,586        14,327        20,174        20,000

  . Denmark                195             558           331           53            350           5,000

  . U.K.                   1,090           897           11,744        1,752         1,289         5,000

  . Other EU               8,652           4,635         9,162         6,984         6,196         6,000

                                                                                                   

  **Other:**               **9,233**       **16,768**    **13,988**    **15,735**    **20,967**    **20,000**

  . China                  182             862           225           1,437         97            2,000

  . Chile                  3,111           4,979         6,856         8,957         13,429        7,000

  . Argentina              2,560           2,841         3,012         3,628         4,207         5,000

                           3,379           8,086         3,895         1,713         3,235         6,000
  --------------------- -- --------------- ------------- ------------- ------------- ------------- -------------

**Spain: Total Wine Imports (Units: Thousand U.S. Dollars)**

  ----------------- ------------ ------------ ------------ ------------- ------------- -------------
  **Partner         **1,000                                                            
  Country**         United                                                             
                    States                                                             
                    Dollars**                                                          

                    **2000 **    **2001 **    **2002 **    **2003 **     **2004 **     **2005**

                                                                                       

  **Total**         **80,847**   **64,052**   **76,769**   **103,821**   **131,051**   **122,000**

                                                                                       

  **From U.S.**     **597**      **500**      **418**      **428**       **764**       **900**

                                                                                       

  **From EU**       **77,563**   **59,463**   **71,742**   **98,568**    **124,449**   **105,000**

  . Italy           24,270       12,623       12,043       22,239        33,477        31,000

  . France          38,301       33,340       41,354       51,420        55,061        49,000

  . Portugal        10,070       9,516        11,874       15,769        28,109        13,000

  . Germany         1,382        1,928        2,041        2,737         4,253         3,000

  . Denmark         112          152          78           40            79            900

  . U.K.            375          433          1,034        1,405         972           1,500

  . Other EU        3,052        1,472        3,318        4,960         2,499         6,600

                                                                                       

  **Other:**        **2,687**    **4,089**    **4,610**    **4,825**     **5,837**     16,100

  . China           20           56           21           142           11            400

  . Chile           991          1,540        2,068        2,419         2,757         2,900

  . Argentina       791          862          871          976           1,347         9,700

                    885          1,631        1,649        1,288         1,722         3,100
  ----------------- ------------ ------------ ------------ ------------- ------------- -------------

Source: Global Trade Atlas up till 2004, and FAS/Iberia for 2005. Note:
Data is on Calendar Year basis. Products covered are from the EU
harmonized tariff schedule numbers 2204, except 2204.30 (wine must) and
2205.

**Spain: Total Wine Exports (Units: Hectoliters)**

+----------+---+--------+---------+--------+---------+---------+---------+
| *        |   | ##     |         |        |         |         |         |
| *Partner |   | ###### |         |        |         |         |         |
| Co       |   |  Hecto |         |        |         |         |         |
| untry:** |   | liters |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
|          |   | **2    | **      | **2    | **      | **      | *       |
|          |   | 000 ** | 2001 ** | 002 ** | 2003 ** | 2004 ** | *2005** |
+----------+---+--------+---------+--------+---------+---------+---------+
|          |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| ####     |   | *      | **10,15 | *      | **12,39 | **14,25 | **13,40 |
| ## Total |   | *8,816 | 1,736** | *9,935 | 0,350** | 5,381** | 0,000** |
|          |   | ,518** |         | ,492** |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
|          |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| **To     |   | **198  | **21    | **262  | **29    | **34    | **38    |
| U.S.**   |   | ,590** | 5,022** | ,179** | 6,417** | 3,923** | 5,000** |
+----------+---+--------+---------+--------+---------+---------+---------+
|          |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| To EU    |   | *      | **8,06  | *      | **10,13 | **11,71 | **10,20 |
|          |   | *6,807 | 6,960** | *7,644 | 1,288** | 3,885** | 0,000** |
|          |   | ,831** |         | ,637** |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . France |   | 1,1    | 1,      | 1,5    | 2,      | 3,      | 3,      |
|          |   | 34,694 | 549,432 | 63,127 | 320,752 | 195,367 | 100,000 |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 1,2    | 1,      | 1,5    | 2,      | 2,      | 2,      |
| Germany  |   | 69,676 | 609,266 | 03,660 | 186,210 | 719,630 | 000,000 |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 1,7    | 1,      | 1,2    | 1,      | 1,      | 1,      |
| Portugal |   | 64,539 | 732,532 | 32,158 | 329,659 | 536,479 | 400,000 |
+----------+---+--------+---------+--------+---------+---------+---------+
| . U.K.   |   | 9      | 1,      | 1,0    | 1,      | 1,      | 1,      |
|          |   | 13,481 | 149,349 | 73,456 | 111,973 | 178,678 | 000,000 |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Italy  |   | 82,387 | 281,873 | 4      | 1,      | 1,      | 700,000 |
|          |   |        |         | 98,591 | 279,727 | 216,639 |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 4      | 411,122 | 4      | 433,258 | 402,466 | 450,000 |
| Net      |   | 12,037 |         | 22,420 |         |         |         |
| herlands |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 4      | 417,471 | 3      | 336,657 | 307,037 | 290,000 |
| Denmark  |   | 16,585 |         | 63,510 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Sweden |   | 3      | 353,931 | 3      | 336,764 | 288,842 | 265,000 |
|          |   | 34,217 |         | 69,333 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Czech  |   | 86,864 | 162,743 | 1      | 148,018 | 227,567 | 169,000 |
| Republic |   |        |         | 83,110 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 1      | 110,146 | 1      | 155,799 | 176,373 | 182,000 |
| Belgium  |   | 11,682 |         | 25,349 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Latvia |   | 55,641 | 45,942  | 61,936 | 95,465  | 59,340  | 133,000 |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 93,385 | 107,690 | 1      | 99,858  | 86,642  | 94,000  |
| Finland  |   |        |         | 03,625 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 1,651  | 1,049   | 4,237  | 3,705   | 23,028  | 54,000  |
| Slovakia |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Poland |   | 16,732 | 16,195  | 18,428 | 29,502  | 46,397  | 57,000  |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Other  |   | 1      | 118,220 | 1      | 263,941 | 249,400 | 306,000 |
| EU       |   | 14,259 |         | 21,697 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
|          |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| To       |   | *      | **1,86  | *      | **1,96  | **2,19  | **2,80  |
| Non-EU   |   | *1,810 | 9,753** | *2,028 | 2,645** | 7,574** | 0,000** |
|          |   | ,097** |         | ,676** |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Russia |   | 61,921 | 44,029  | 1      | 173,823 | 277,389 | 500,000 |
|          |   |        |         | 33,677 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 2      | 299,791 | 2      | 311,336 | 316,559 | 313,000 |
| Swi      |   | 65,210 |         | 68,045 |         |         |         |
| tzerland |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Angola |   | 1      | 134,080 | 1      | 30,011  | 141,975 | 260,000 |
|          |   | 29,988 |         | 48,489 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . China  |   | 2      | 49,920  | 20,805 | 13,114  | 24,433  | 240,000 |
|          |   | 10,093 |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Canada |   | 63,472 | 63,795  | 80,331 | 102,146 | 131,877 | 210,000 |
+----------+---+--------+---------+--------+---------+---------+---------+
| .        |   | 61,129 | 109,823 | 1      | 129,073 | 136,702 | 105,000 |
| Eq       |   |        |         | 22,925 |         |         |         |
| uatorial |   |        |         |        |         |         |         |
| Guinea   |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Cote   |   | 1      | 245,045 | 2      | 235,866 | 145,208 | 89,000  |
| d        |   | 74,292 |         | 75,009 |         |         |         |
| \'Ivoire |   |        |         |        |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Japan  |   | 89,490 | 84,450  | 81,246 | 90,091  | 101,912 | 114,000 |
+----------+---+--------+---------+--------+---------+---------+---------+
| . Mexico |   | 36,431 | 52,596  | 54,352 | 52,247  | 61,902  | 76,000  |
+----------+---+--------+---------+--------+---------+---------+---------+
| . All    |   | 7      | 786,224 | 8      | 824,938 | 859,618 | 893,000 |
| Other    |   | 18,070 |         | 43,796 |         |         |         |
+----------+---+--------+---------+--------+---------+---------+---------+

Source: Global Trade Atlas up till 2004, and FAS/Iberia for 2005. Note:
Data is on Calendar Year basis. Products covered are from the EU
harmonized tariff schedule numbers 2204, except 2204.30 (wine must) and
2205.

**Spain: Total Wine Exports (Units: 1,000 USD)**

  ---------------- --------------- --------------- --------------- --------------- --------------- ---------------
  **Partner                                                                                        
  Country**                                                                                        

                   **2000 **       **2001 **       **2002 **       **2003 **       **2004 **       **2005**

                                                                                                   

  **Total**        **1,171,223**   **1,266,489**   **1,319,425**   **1,677,919**   **1,934,238**   **1,900,000**

                                                                                                   

  **To U.S.**      **94,715**      **103,911**     **128,087**     **153,989**     **182,338**     **200,000**

                                                                                                   

  **To EU**        **830,816**     **919,507**     **927,720**     **1,208,561**   **1,393,005**   **1,300,000**

  . Germany        239,969         257,181         264,034         345,920         390,155         356,000

  . U.K.           179,991         223,256         241,150         292,153         348,969         304,000

  . France         59,518          63,853          67,262          112,117         156,192         148,000

  . Netherlands    70,163          73,512          77,756          95,991          94,950          89,000

  . Denmark        65,138          65,562          57,759          64,742          60,756          60,000

  . Sweden         60,655          59,933          65,995          66,832          64,936          60,000

  . Portugal       77,131          75,414          46,120          60,583          75,465          57,000

  . Belgium        26,005          38,055          27,889          36,972          48,246          50,000

  . Italy          6,538           10,871          20,292          57,256          59,339          39,000

  . Finland        17,284          21,587          22,062          24,992          25,181          26,000

  . Czech Republic 2,832           4,968           5,902           6,052           11,544          12,000

  . Poland         2,325           2,559           2,890           4,752           6,791           8,000

  . Latvia         2,202           1,940           2,823           5,842           4,765           9,000

  . Slovakia       60              63              240             275             1,707           30,000

  . Other EU       21,006          20,753          25,547          34,082          44,009          52,000

                                                                                                   

  To Non-EU        **245,692**     **243,071**     **263,618**     **315,369**     **358,895**     **400,000**

  . Switzerland    62,554          67,294          65,862          86,389          89,501          90,000

  . Canada         17,888          18,264          22,398          29,307          33,394          44,000

  . Japan          26,846          22,963          23,141          27,532          37,094          40,000

  . Mexico         14,483          18,519          21,698          25,772          31,096          37,000

  . Russia         4,172           4,146           8,131           13,086          19,177          30,000

  . Angola         5,525           6,864           6,290           1,495           7,172           14,000

  . China          11,041          2,488           1,134           1,236           2,614           11,000

  . Equatorial     2,664           4,269           5,151           6,606           7,899           6,000
  Guinea                                                                                           

  . Cote d\'Ivoire 5,748           7,108           8,040           8,515           5,665           3,000

  . All Other      94,770          91,156          101,772         115,431         125,283         125,000
  ---------------- --------------- --------------- --------------- --------------- --------------- ---------------

Source: Global Trade Atlas up till 2004, and FAS/Iberia for 2005. Note:
Data is on Calendar Year basis. Products covered are from the EU
harmonized tariff schedule numbers 2204, except 2204.30 (wine must) and
2205.

-   The decline in CY-2005 Spanish wine exports resulted from a large
    drop in bulk sales (down 17 percent in value, and down 13 percent in
    volume), due to competition from France, Italy, and Portugal.
    However, the average bulk export price rose five percent to 1.03
    €/liter on the decreased export volume.

-   High-quality wine exports, including table wines and regional wines,
    were up year-on-year 11 percent in value, and seven percent in
    volume. GI wines were up three percent in value and five percent in
    volume. White GI wines doubled in export volume and value (from very
    low levels), and sparkling wines increased five percent in value.

-   Spanish subsidized wine exports consist basically in bulk reds and
    \"roses\", which are destined for the African markets. Sulk whites
    are primarily destined for the Asian and Eastern European markets.

-   In addition to wine, Spain has significant wine-must exports (see
    tables below).

Spain: Must Exports (Units: Hectoliters)

  ---------------- ------------- -------------- ------------- ------------- ------------- -------------
  **Partner                      **Quantity**                                             
  Country**                                                                               

                   **2000 **     **2001 **      **2002 **     **2003 **     **2004 **     **2005**

                                                                                          

  **Total**        **111,882**   **35,643**     **205,310**   **242,239**   **335,350**   **245,000**

                                                                                          

  **To U.S.**      0             0              0             0             0             **50**

                                                                                          

  To EU            110,466       34,224         204,830       242,111       333,441       **244,800**

  . Italy          0             2              125,514       113,551       234,339       **172,000**

  . France         74,312        18,4112        63,087        112,225       90,518        **65,000**

  . Germany        6,469         5,591          11,890        10,4889       4,958         6,900

  . Other EU       29,685        10,219         4,339         5,846         3,626         900

                                                                                          

  To Other Non-EU  **1,416**     **1,419**      **480**       **128**       **1,909**     **150**
  ---------------- ------------- -------------- ------------- ------------- ------------- -------------

Source: Global Trade Atlas up till 2004, and FAS/Iberia for 2005. Note:
Data is on Calendar Year basis. Products covered are from the EU
harmonized tariff schedule number 2204.30.

**Spain: Must Exports (Units: 1,000 USD)**

  ---------------- --------------- --------------- --------------- --------------- --------------- ---------------
  **Partner                        **Quantity**                                                    
  Country**                                                                                        

                   **2000 **       **2001 **       **2002 **       **2003 **       **2004 **       **2005**

                                                                                                   

  **Total**        **1,143,901**   **1,209,517**   **1,288,621**   **1,638,970**   **1,896,561**   **1,815,000**

                                                                                                   

  **To U.S.**      92,121          101,088         124,775         150,418         178,745         **195,000**

                                                                                                   

  To EU            814,889         874,239         910,416         1,186,192       1,370,578       **1,240,000**

  . Germany        237,542         255,226         261,514         342,638         386,934         **348,000**

  . U.K.           179,825         223,004         240,902         291,728         348,384         **303,000**

  . France         55,026          60,005          63,458          106,299         151,974         142,000

  . Netherlands    69,554          66,254          75,144          93,778          92,220          86,000

  . Denmark        65,103          65,514          57,750          64,716          60,724          60,000

  . Sweden         60,655          59,933          65,995          66,832          64,936          60,000

  . Portugal       73,863          61,455          42,124          53,690          70,785          52,000

  . Belgium        18,776          18,124          22,146          30,129          40,679          43,000

  . Italy          5,674           10,172          19,492          55,964          58,035          38,000

  . Finland        17,280          21,563          22,053          24,992          25,181          26,000

  . Czech Republic 2,832           4,968           5,902           6,052           11,544          12,000

  . Poland         2,132           2,397           2,748           4,613           6,645           8,000

  . Latvia         2,172           1,925           2,786           5,766           4,726           9,000

  . Slovakia       60              63              189             275             1,638           300

  . Other EU       24,395          23,637          28,214          38,720          46,171          52,700

                                                                                                   

  To Non-EU        **236,891**     **234,190**     **253,430**     **302,360**     **347,238**     **380,000**

  . Switzerland    62,122          66,794          65,563          85,892          89,128          89,000

  . Canada         17,648          17,943          22,042          28,740          32,901          43,000

  . Japan          26,171          22,243          22,350          26,831          36,558          39,000

  . Mexico         14,443          18,446          21,537          25,712          30,925          37,000

  . Russia         4,171           4,090           7,892           13,026          18,951          30,000

  . Angola         5,523           6,864           6,278           1,495           7,160           14,000

  . China          10,999          2,488           1,127           1,236           2,614           11,000

  . Equatorial     2,631           4,215           5,048           6,458           7,668           6,000
  Guinea                                                                                           

  . Cote d\'Ivoire 5,740           7,094           8,018           8,381           5,595           3,000

  . All Other      87,443          84,014          93,576          104,590         115,737         108,000
  ---------------- --------------- --------------- --------------- --------------- --------------- ---------------

Source: Global Trade Atlas up till 2004, and FAS/Iberia for 2005. Note:
Data is on Calendar Year basis. Products covered are from the EU
harmonized tariff schedule number 2204.30.

## Trade Matrices

  -------------------- -------------- -------------------- --------------
  **Import Trade                                           
  Matrix**                                                 

  **Country**          Spain                               

  **Commodity**        Wine                                

  Time Period          Sept/Aug       Units:               Hectoliters

  Imports for:         2003                                **2004**

  U.S.                 250            U.S.                 582

  Others                              Others               

  Italy                124,906        Italy                168,901

  Portugal             74,795         France               57,753

  France               33,623         Portugal             53,246

  Germany              20,716         Germany              19,349

  Netherlands          1,918          U.K.                 4,773

  Other EU             6,444          Denmark              3,922

  Chile                11,204         Other EU             4,965

  Argentina            4,046          Chile                9,675

  Australia            519            Argentina            4,737

  Switzerland          219            Australia            1,427

  Total for Others     278,390                             328,748

  Others not Listed    1,638                               5,939

  Grand Total          280,278                             335,269
  -------------------- -------------- -------------------- --------------

  -------------------- -------------- -------------------- --------------
  **Export Trade                                           
  Matrix**                                                 

  **Country**          Spain                               

  **Commodity**        Wine                                

  Time Period          Sept/Aug       Units:               Hectoliters

  Exports for:         2003                                **2004**

  U.S.                 349,544        U.S.                 390,286

  Others                              Others               

  France               3,121,922      France               3,166,660

  Germany              2,712,592      Germany              2,352,950

  Portugal             1,507,722      Portugal             1,493,509

  Italy                1,228,350      U.K.                 1,201,246

  U.K.                 1,172,785      Italy                842,407

  Netherlands          433,968        Netherlands          470,994

  Denmark              315,536        Other EU             1,564,591

  Other EU             1,238,313      Russia               366,857

  Switzerland          313,778        Switzerland          329,323

  Russia               292,012        Angola               224,768

  Total for Others     12,336,978                          12,013,305

  Others not Listed    1,652,032                           1,688,473

  Grand Total          14,338,554                          14,092,064
  -------------------- -------------- -------------------- --------------

# Policy

**General**

-   On November 14, 2005, the EU Council of Ministers approved the US-EU
    wine Agreement. However, an interim agreement, based on derogations
    in place since the end of CY 2005, will prevail until full
    application of the final Agreement. For information on the
    Agreement, including on wine practices allowed and labeling
    provisions, as well as on EU wine import rules currently in effect,
    please check the FAS Brussels site at
    <http://www.useu.be/agri/wine.html>.

## Import Tariffs

-   Spanish wine imports are subject to EU tariffs. For tariffs
    currently in effect, please check EC Regulation 1719/2005 dated
    October 27, 2005, published in the Official Journal of the EU on
    October 28, 2005 and the tables below.

-   Excise taxes are not in effect, but wines are subject to a 16
    percent VAT.

**EU Wine Import Tariffs Currently in Effect**

  ----------------------- -------------------------------- ---------------
  **HTSCN**               **Description**                  **Tariffs**

  2204.10                 Sparkling wines                  32 €/hl

  \-- Bottled Wines                                        

  2204.21.10              Other sparkling wine             32 €/hl

  2204.21.11 to 80        Wine Under 13 % alcohol          13.1 €/hl

  2204.21.81              Tokaj                            15.8 €/hl

  2204.21.82 to 85        Wine with alcohol content        15.4 €/hl
                          between 13 and 15%               

  2204.21.87 to 98        Wine with 15 to 22% alcohol      14.8 to 20.9
                                                           €/hl

  2204.21.99              Wine with more than 22% alcohol  1.75 €/% vol/hl

  **\-- Wine in Bulk**                                     

  2204.29.10              Other sparkling wine             32 €/hl

  2204.29.11              Wine Under 13 % alcohol          13.1 €/hl

  2204.29.12 to 75        Tokaj                            9.9 €/hl

  2204.29.77 to 98        Wine with alcohol content        12.1 to 20.9
                          between 13 and 15%               

  2204.29.99              Wine with 15 to 22% alcohol      1.75 €/% vol/hl

  **\-- Vermuth and other                                  
  flavored wines**                                         

  \-\-- Bottled                                            

  2205.10.10              Wines with less than 18% alcohol 10.9 €/hl

  2205.10.90              Wine with more than 18% alcohol  0.9 €/ %
                                                           vol/hl + 6.4
                                                           €/hl

  \-\-- In bulk                                            

  2205.90.10              Wines with less than 18% alcohol 9 €/hl

  2205.90.90              Wine with more than 18% alcohol  0.9 €/ % vol/hl
  ----------------------- -------------------------------- ---------------

Source: EC Regulation 1719/2005 of 10. 27.2005

# Marketing

-   Some 70 percent of wine sold in Spain is distributed through the
    hotel and restaurant channels, and the remaining 30 percent through
    channels directed for home consumption.

-   For exporters interested in exploring this market, please contact
    the following for additional market information:

Office of Agricultural Affairs

FAS/Iberia

E-mail: AgIberia@usda.gov