Grupo Peñaflor’s future is premium

Moving into premium segments is an urgent task for Argentina’s producers. Jürgen Mathäß reports on how the biggest player is doing it.

Trapiche winery, Argentina
Trapiche winery, Argentina

With sales of $560m and a 26 percent share of Argentine wine exports, Grupo Peñaflor is the market leader in the Argentine wine industry. Owned by the Bemberg family, the group includes the wineries Trapiche, Finca Las Moras, Bodega El Esteco, Navarro Correas, Mascota Vineyards, Santa Ana, Bodegas La Rosa and Andean Vineyards. This spring, the group adopted its new five-year strategic plan, involving production, distribution and communication relating to trends in all markets.

Going premium

“The focus is essentially on increasing the volume of premium wines in our export range,” says Pablo Ghiorzi, the company’s export director. “The challenge in this regard goes far beyond providing consistent quality; it is more about cultivating the identity and character of each individual wine. The communication for this must be based on the experiences of the consumers in tasting the wines.”

The company considers Asia to have the best growth potential for Argentina in general and for the group, with a lot of potential still in North America. When it comes to Europe, however, Peñaflor foresees challenges resulting from the high level of competition. “But there are opportunities,” emphasises Ghiorzi. “For example, in Germany we are currently doing well in the premium segment, such as with Trapiche Oak Cask for €6.99 ($8.15). The same applies to Great Britain and Benelux as well as Scandinavia. Chile has done well in terms of volume in some of these countries, but with lower prices than Argentina. In contrast, we will focus more on the international tendency to drink less but better quality wine." 

In Argentina, there were very small but high-quality harvests in 2016 and 2017, which has affected the competitive landscape. “Grape prices on the market have increased considerably,” says Ghiorzi. “Grupo Peñaflor has gone to great lengths to keep prices stable and strengthen confidence among our strategic partners.” The fact that Peñaflor, with more than 6,000 hectares of its own vineyards, is less affected by grape prices than many of its competitors has certainly helped.

The wineries in the group will continue to set their own priorities, both in terms of the different origins of their wines and the focus of their market activities. Trapiche will consolidate its position as the Argentine market leader in terms of volume and value, with customers in more than 90 countries. Finca Las Moras has a strategic role for the group in terms of younger consumers and innovative trends. El Esteco in the Calchaquí Valley retains its role as an icon of the Argentine north. The traditional Navarro Correas winery will be further developed on the international markets with super-premium wines. Mascota Vineyards, as a “bodega de vinos de autor” — signature wines — is developing very satisfactorily in Europe as well as in the USA.

What lies ahead

In terms of wine types, Malbec remains the dominant wine for the group in the markets for Argentine wines. Trapiche is the winery that sells most Malbec worldwide. But there are also opportunities for other wines, such as Cabernet Sauvignon, Chardonnay and Torrontés.

Trapiche caters for the international trend for wines grown in cool climates not only with its high-altitude vineyards, which are common in Argentina, but also with a new start-up in the east of the country near the ocean, where there has not previously been any wine production. At Chapadmalal, just 7km from the Atlantic Ocean, grape varieties such as Chardonnay, Sauvignon Blanc, Pinot Grigio, Albariño and Pinot Noir are being planted. While Argentina is consolidating its position in red wines worldwide, Peñaflor will also work intensively over the next five years on white wines and rosés. 

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