SA wine industry moves from bulk to fine wine, receiving international recognition!

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South Africa’s wine industry has made great strides in the past ten years, from being a bulk exporter of ‘cheap and cheerful’ wines to being on the ‘brink of breaking into the international fine wine spotlight’, wrote Mike Ratcliffe, owner of Warrick Wine Estate, in the Sunday Times recently.

Ratcliffe writes that the bulk export of low cost South African wines damaged our country’s image as a wine-producing country, but that this is being turned around, with excellent quality wines being exported.  He ascribes the success of the wine industry to the folloiwng:

*   tackling the reputation and improving the quality, for example, of a cultivar such as Pinotage, which was ‘mocked in global circles’. Ratcliffe praises the industry’s ability to accept criticism (however UK wine writer Rebecca Gibbs experienced the opposite in a Pinotage workshop at CapeWine 2012).

*   The young up and coming winemakers are innovating, and ‘breaking down barriers and pushing the envelope of experimentation’, and challenging region and variety.  The older guard and wine co-operatives are changing ‘their business models and driving quality innovations’.

*   South African wines are as good and some even better than their international counterparts, and are being recognised by international wine buyers and wine drinkers.  This was confirmed at CapeWine 2012, where heaps of praise was showered upon the South African wine industry.  This is making winemakers more confident about their wines.

*   The industry is producing more quality wines, and the prices of these wines are increasing, as more of them are exported.

*  More co-operative marketing is taking place, CapeWine 2012 having been the most excellent showcase of our country’s top wines. Despite their differences, ‘the wine industry is presenting a strong and united front’.

Alongside Ratcliffe’s article was one entitled ‘Wine farms look wobbly’, sad to see after the euphoria created for our wine industry at CapeWines 2012.  Quoting a report by VinPro and Winetech, it shared that high costs are slashing profits, the cost per hectare having increased by 61% to over R30000 in the past 7 years, mainly due to electricity, fuel and water cost increases.  Income has dropped from R1 per 750 ml bottle in 2004 to 38 cents now.  Some optimism about the forthcoming harvest has been expressed, a larger harvest leading to better profit. Wine production is expected to grow by 7% this year, to 1,1 billion gross litres.  Bulk wine exports grew by 26% and bottled wine exports dropped by 9%.  Exports increased by 7%, and domestic sales by 4% in the past year.  Wine farmers are surviving the downward profitability trend by diversifying into other forms of farming, and by adding wine tourism attractions to their farms.

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com Twitter: @WhaleCottage

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6 replies on “SA wine industry moves from bulk to fine wine, receiving international recognition!”

  1. Nick Jones says:

    Whilst I’m certainly no connoisseur, I have noticed a marked improvement in the quality of wines available in South Africa during the past 15 years.

    This is also reflected on the shelves of Majestic, my preferred wine merchant in the UK. However, most of our major supermarkets still concentrate on bulk, rather than quality, concentrating on the £5.00 per bottle market.

  2. Sorry I don’t buy it. 57% of last year’s wine exports were in bulk. Where precisely is this spike in fine wine exports we’re supposed to be experiencing? Warwick may be doing well along with a handful of other boutique producers but the Vinpro figures tell the true story of where the SA wine industry is right now as a whole. Times are not g

  3. Thanks for the feedback Norman.

    Perhaps our image is more focused on the fine wines than on the bulk wine imports?

    Chris

  4. Thank you for the feedback Nick.

    I do hope you are supporting our fine wines in the UK?

    Chris

  5. Nick Jones says:

    Oh yes Chris & Majestic are constantly adding to their range. They are now retailing 50 different wines & as an example, Boukenhoutskloof The Chocolate Block 2011 Western Cape is retailing at £20.00 per bottle during the 20% of sale of all SA wines. Vergelegen Red 2005 Stellenbosch retails for £28.00.

    I’m still very slowly working my way through the 24 bottles of Thelema Reserve Merlot which I brought back from Cape Town in March. I’m trying to make it last until Feb.

    It’s drinking very well & tastes even better because the friendly customs officer didn’t charge me any import duty!!

  6. That’s an excellent price for the Chocolate Block Nick.

    You were very lucky with the kind Customs officer.

    Chris

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