Southeast Asia is one of the fastest growing regions for wine consumption. Over the coming months, the Market Bulletin will feature profiles on key markets within Southeast Asia. We start with Thailand, Southeast Asia’s second largest economy.
Download the full Market Bulletin Thailand profile for details about the current economic and socio-political climate, market access and more market insights.
Wine – a small but growing category in Thailand
In 2015, wine sales grew 11 per cent to 20.1 million litres. This represents 0.8 per cent of Thailand’s 2.7 billion litre alcoholic drinks market.
Consumer awareness of wine is growing
Once a relatively little known beverage in Thailand, wine is now regularly served at social functions and is perceived as a sign of higher social status amongst Thais. With an already significant but growing number of pubs, bars and restaurants serving wine, there has also been a large growth in the number of wine drinkers among Thai consumers, who are typically aged between 25 to 55 years.
Australian wine has a good reputation in Thailand
Australia is the second largest exporter by value to Thailand (26 per cent share), after France (39 per cent). In the 12 months ended March 2017, Australia exported 4.4 million litres of wine to Thailand valued at $20.3 million FOB. This makes Thailand the third largest destination for Australian wine exports to Southeast Asia, behind Singapore and Malaysia.
Australian wine has benefited from TAFTA by preferential tariff treatment
Australia's trade and economic relationship with Thailand has grown strongly since the Thailand–Australia Free Trade Agreement (TAFTA) came into effect on 1 January 2005. As of 1 January 2015, the import tariff has been eliminated for Australian wine.
Through TAFTA, Australian wine has a 54 per cent price advantage over competitor countries such as France, Italy, Spain, Portugal, Chile, Argentina, the United States and South Africa, which do not have FTAs with Thailand.
Euromonitor International is forecasting Thailand’s wine market to rise by 9 per cent per annum through to 2020. It is expected that Millennials will drive the growth, with their increasing appreciation for wines and spirits. Furthermore, wine is becoming more readily available to the general consumer.
Australia, with its close ties and already strong position in the market, is poised to take advantage of this growth.