WINE: Look To Asia And USA For Wine Growth
Recent Western Cape Business News
The European markets have matured and their economies will not recover within the next decade; however the USA and Asia hold promise for the local wine industry, which is facing its toughest time yet. Africa also has potential for growth.
This was the message from various presenters at the seventh Nedbank VinPro Information Day in Somerset West, where 530 delegates from the wine industry value-chain were clearly looking for answers. The wine industry is plagued by low profit margins, decreasing sales and a shrinking area under vines.
“We should consistently make good wines and market ourselves with a simple, sincere and repetitive message,” said guest speaker Johann Rupert, prominent businessman and owner of L’Ormarins Estate.
He expressed concern about the dumping of cheap wines from overseas into the domestic market, but warned against uncertified bulk wine exports to Europe. “The day that Europe suspects us of dumping, we can forget about exporting any more wine to them.”
Marian Kopp, managing director of Niederkirchener Weinmacher eG in Germany, predicted that the USA and Asia will drive a 6% growth in global wine consumption over the next four years.
In the meantime, South Africa’s domestic wine market is stagnant and wine producers’ profitability is the lowest in eight years. “Of a bottle of wine sold at R70 in a restaurant, the waiter receives a R7,00 tip, whereas the producer only receives R3,00. Producers’ income did not keep up with soaring production costs,” said Phillip Retief, head of Van Loveren Vineyards.
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