How the Portuguese wine industry is reinventing itself

At the last Wine Paris & Vinexpo Paris exhibition, there were over 140 Portuguese exhibitors, compared with just 57 the previous year. Portuguese companies are ramping up their presence on the international stage. Exports are headed north, the wines are garnering increased recognition and innovations are being rolled out more and more. Despite its vitality, however, the industry is faced with significant structural issues, leading the EU to grant it a further 15 million euros in funding this year, on the back of the 20 million allocated last year. The grants came in addition to the millions of euros handed out by the country’s own government to provide support for winegrowers. Lisbon opened a 100-million-euro line of credit over three years, retroactively applied to 2023 in a bid to ease major cash flow problems among winegrowers.

Rising to the challenges

The economic difficulties can partly be ascribed to unprecedented inventories of Portuguese wines. Several trade organisations have been pointing the finger at imports of bulk wines from Spain, which they claim have increased supplies. They have also levelled criticism at misleading labels which they feel deceive consumers over the origin of the wines and create unfair competition. The Portuguese authorities were quick to respond – last May, arrivals of grapes and must were banned in the Douro region. Since then, they have promised more checks on trade and transportation of wine within the country and announced a review of labelling legislation in order to clarify the origins of every bottle for consumers.

Other factors also contributed to excess inventories, however, including the 10% year-on-year decline in domestic consumption. Admittedly, the Portuguese continue to rank as the world’s leading per capita consumer country, with 52 litres per person in 2023 according to the International Vine & Wine Organisation. But, just like everywhere else, consumption is trending downwards, particularly for the red wines. Driving the trend is a number of different economic, demographic and cultural factors, including changing consumer trends – a surge in beer and an end to moderate daily consumption for instance – along with anti-alcohol campaigns by the World Health Organisation and a rise in the cost of living.

As in other European countries, some industry members are advocating for green harvesting or vine pulls to cope with this structural change in consumption. “The reduction in demand must be counterbalanced by a drop in wine supplies and the only effective and sustainable way of achieving this is to reduce vineyard acreage by uprooting vines”, claims Oscar Quevedo, CEO of the Quevedo winery set in the very heart of the Douro Valley.  

Claudia and Oscar Quevedo perpetuate the skills passed down through a family that has been making Port for five generations .

Alongside his sister, Oscar Quevedo now runs the family adega Quevedo.

Whilst national demand has slowed, international markets are bullish. Over the past few years, Portugal has witnessed an increase in its wine exports, both by volume and value. The share of production earmarked for exports by the country’s adegas or wineries has expanded. The family-run Quevedo winery, for example, exports 94% of its wines and it is not alone in favouring exports. Portuguese wine firms have been increasingly successful at carving out a place for themselves in the global marketplace, even if competition is fierce. Establishing a footing in a market that is already saturated is no easy task, but the Portuguese wine industry is certainly not lacking in resourcefulness or energy as it seeks freedom overseas. It can also count on support from the authorities to promote exports – part of the government’s aid for the industry has been set aside for PR and promotion of Portuguese wines in a bid to step up export presence. The State has also promised to dial up its efforts to remove customs barriers in countries that could potentially offer exporters new opportunities. Similarly, each region is taking steps to help winegrowers raise awareness of their wines. Arlindo Cunha, chairman of the Dão wine board, explains how his organisation has established “a promotional programme for the domestic market and leading export markets where we are investing on average half a million euros annually”.

Situated in the centre-north of Portugal, the Dão region is home to many native grape varieties including Touriga nacional and Encruzado.

The marketing efforts have been rewarded because not only has Portugal managed to strengthen its presence in its long-standing markets like France, the United States, Spain and Portuguese-speaking countries, it has also diversified its overseas networks. A number of wineries are now securing a name for themselves in Asia, in countries like South Korea and China. According to the latest data for the first half of the year, quoted by Cunha, “Dão wines were exported to 70 countries, totalling nearly 3 million litres of certified wine” (approximately 40% of production). “Roughly half this volume was exported to the European Union and the other half to other parts of the world”.

Arlindo Cunha, chairman of the Dão wine board.

Dão wines are extremely elegant and offer excellent value for money.

Adaptation and innovation 

A few years ago, Portugal was only associated with its storied fortified wines – Port and Madeira – but now that has all changed. Other wines have been showcased and gained a high profile – these include still wines labelled DOC Douro, the famous vinho verde and fruity reds from Alentejo. Admittedly, more still needs to be done to popularise Portugal’s true gems, which remain under the radar in comparison with their famous neighbours. However, industry stakeholders certainly do not lack ideas when it comes to publicising their wines, particularly as they can meet a variety of market needs and resonate with consumer trends such as the popularity of white wines and interest in de-alcoholised wines.

One avenue being actively explored is research into new demand and the ability to supply alternatives. “Research helps us understand market changes, adapt and, to some extent, anticipate the future”, explains Cunha. Recently, a study conducted in the Douro region showed how applying kaolin (or white clay) on Touriga nacional grapes – the country’s famous native variety – reduced alcohol content in the wines. Another study, which dates back to 2017 but was resumed in 2024 by a Portuguese start-up company for marketing purposes, suggested making sulphite-free wines by using chestnut flowers. It seems that the flowers have the same antioxidant and anti-microbial effects as SO₂. It just goes to show that science can promote progress in natural winegrowing…

Research is particularly active in providing new avenues and allowing viticulture to move forward faced with what is proving to be the greatest challenge for winegrowers, in Portugal and across the globe – climate change. “This requires constant adaptation in vineyard management”, stresses Abel Codesso, head winemaker at Provam. “It is affecting all of us, often unfavourably”, points out Oscar Quevedo. “In the Douro Valley, we are seeing hot areas where vines are struggling to complete the ripening process. Happily, the vines are grown in the mountains and we have the ability to plant them at high altitudes. The average annual temperature is lower, allowing the vines to grow in a more balanced climate. However, not everyone is this lucky and I fear that viticulture in many valley floor areas will struggle to cope with the effects of climate change”.

Abel Codesso, the head winemaker at Provam.

Quevedo Ports show distinctively less sweetness, allowing their natural flavours to shine through.

The Quevedo family’s first vines were planted in 1889.

A lot of the research is focusing on grape varieties and their resilience to drought and other consequences of climate change. Arlindo Cunha explains how the Dão wine board is working with the Ministry of Agriculture and Viseu Polytechnic University along with the region’s leading companies and co-operatives to draft a research programme that aims to explore the effects of climate change on the performance of different grape varieties and their resultant wines. In 2023, this led to the creation of a Dão branch at the CoLab Vine & Wine, an institution tasked with improving Portuguese viticulture. At the core of this programme is value creation, a focus that all the industry members we spoke to wholeheartedly agree with. It is most certainly the chosen route for successfully competing in international or national markets.

Focusing on quality and exclusivity

Cunha has a clear mission: “Our primary objective is to maintain the level of quality that we have achieved for Dão wines, safeguard our incredible traditional grape varieties and continue restructuring our vineyards and training the professionals we need across the industry spectrum, from viticulture to winemaking, management to wine tourism, in order to generate greater value”.

Endorsing excellence is the only option, hence the significance of certifications which guarantee the quality of the products. The head of communications at Alorna, a long-standing winery in the Tejo region, explains that one of their priorities is to secure certification for their company at several levels. “IFS certification guarantees food safety, whereas Integrated Production certification, applied to all aspects of Quinta da Alorna – vines, forest and farming – along with sustainability certification for the wine sector, ramp up our commitment to the environment”.

Quinta da Alorna is located on the southern bank of the river Tage, near Santarém.

Approximately 50 % of annual production at Quinta da Alorna is exported to 25 countries.

Communication, too, is important. Abel Codesso shares how his company, Provam, which makes stellar Albariños in the Monção and Melgaço region, recently redefined its strategy to focus on its quality message. “In addition to our international reach, we are concentrating on more granular and more effective communications focusing on the distinctive features of our products and the innovations we have developed. This new approach aims to strengthen our brand recognition and cement our position as a benchmark on the international wine scene”.

The goal is to make a difference by emphasising the unique character of the wines. Quevedo, for instance, has just launched two Ports, one white, one red, that have totally broken the mould. They were made from a combination of grape varieties “that no Port has probably ever seen. For the white, we used 67 white varietals and 91 for the red. The varietals come from experimental stocks held by the Ministry of Agriculture which were bought at a public auction”.

Quinta da Alorna recently launched the Alorna Wine Creations project involving construction of a small-batch winery for producing distinctive, high-end, short-run lines. “The latest releases, such as the 1723 Grande Reserva celebrating the three-hundredth anniversary of Quinta da Alorna, the Reserva das Pedras range and more recently Amphorae, illustrate our efforts to supply new, innovative, differentiated products. The initiatives undeniably add value, not only to Quinta da Alorna, but also to the Tejo region”. Slightly farther north, Provam will be unveiling a new vinho verde called ‘Exemplar’ at the start of 2025. The clue is in the name… It is clear that with its 250 native grape varieties – some of which have marginal acreage in other parts of the world – and its outstanding vineyard sites, Portugal does not lack the resources to excel.

At Quinta da Alorna, 80 % of the vineyards are rainfed, thereby promoting more efficient water usage.