Mon, 08 Mar 2021

  • The 2020 harvest of SA's 2020 wine industry was good and vineyards could recover from drought conditions in previous years.
  • Wine exports totalled 319.2 million litres last year, despite a five-week long ban on exports and challenges at the Cape Town Port due to lockdown regulations.
  • The overall value of SA wine exports in 2020 increased by 7.7% to R9.1 billion.

Despite a five-week long ban on exports and huge challenges at the Cape Town Port terminal due to the Covid-19 pandemic and related lockdown regulations in 2020, South Africa's wine industry could still manage to export 319.2 million litres.

Starting in April 2020, during the hard lockdown and related ban on wine sales as well as transport of wine, which prevented exports, WoSA estimated local wine producers were losing about R175 million a week in lost exports due to the alcohol transport ban which was in place at the time.

At the time wine industry representatives argued that the importance of being allowed to export lies not only in the foreign exchange it earns for the country, but also that local producers are trying to make up for a decline in wine exports in 2019.

The harvest in 2020 was good and vineyards could recover from the drought conditions experienced between 2015 and 2018, according to Wines of South Africa (WoSA), the not-for-profit industry body responsible for export promotions in key international markets. The overall value of SA wine exports in 2020 increased by 7.7% to R9.1 billion compared to the previous year, and the value of packaged wine exports grew by 8.3%.

According to WoSA, countries which showed good growth in value include the United Kingdom (28%), The Netherlands (19%), the US (12%) and Sweden (17%).

The value of bulk wine exports increased by 5% to R1.9 billion, and its total volume increased by 3.7% to 181.5 million litres. Bulk wine exports to the UK saw value growth of 13% while bulk wine exports to Denmark and Finland grew by 27% and 29% respectively, and by 33% and 84% respectively to the US and Canada.

Furthermore, there has been a continued growth in the premium segment with wines in the over R40 per liter price point growing steadily in value and volume.

"While still a relatively small volume segment for South Africa, the super-premium segment showed growth of 37% in volume. This growth in the higher tiers highlights the work that WoSA has been doing to promote our quality wines at higher price points," the organisation said in a statement.

South Africa's two distinctive varieties saw good growth in terms of export values at 13% for Chenin Blanc and 12% for Pinotage, the former also being the country's largest single export variety with a total export volume of 48.9 million liters.

The Cap Classique category saw 17% growth, a sign for WoSA of it being a strong category in terms of growing value and quality recognition in overseas markets.

"The year 2020 will probably go down in history books as one of the most challenging years for the industry. However, despite this, we have learnt to adapt and have explored creative ways of engaging with our partners. Through extensive online and social media campaigns..., we managed to draw a lot of awareness to the plight of the South African wine industry and garnered incredible support from the trade, importers and consumers across the globe," said WoSA CEO Siobhan Thompson.

"We are eternally grateful to everyone who has shown us their support and hope that this support will continue as we are yet again banned from selling wine locally for the foreseeable future".

She said WoSA will continue to explore options for the promotion of SA wine in key markets with the focus on creating awareness around quality and growing the image of local wines. Thompson remains hopeful that the SA wine industry, including its important wine tourism component, will be able to return to normal again in due course, and help to put the focus on what SA can offer.

Before the pandemic started, the wine industry created direct and indirect employment for about 300 000 people along its value chain.

Source: News24

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