It predicts that of all the European countries, Britain will show the biggest increase in consumption in both volume and value by 2008, while the French will continue to drink less of their national tipple.
The report says the amount of wine consumed in the UK will go up 16.2% to 1.7 billion bottles and retail value will grow 19% to £6bn, after comparatively high duty rates have been taken into account. That will make the UK the second-largest wine market in value terms after the US.
In terms of volume, the UK moves up into fifth place with the USA again the biggest and the French coming in at third.
Demand for wines priced £6.50 and above is estimated to rise 36.5% to reach 3.2% of volume consumed in 2008, while wines sold at £3.50-£6.50 will make up nearly half of sales.
Discounting pressures will, however, remain intense as wine surplus rises to 3.1bn litres or 11.3% of world production by 2008.
Spirits drinking is also on the increase in the UK, and is predicted to rise 7.3% to reach 27.8m nine-litre cases.
The vodka, liqueur and rum sectors are expected to carry on booming, while demand for gin will remain stable.
Consumption of cognacs and armagnacs is expected to increase by 9.6% over the next four years, but sales of Scotch whisky are expected to continue to fall.