NEWS
AGRICULTURAL VALUE CHAIN
Virtual Descusssion Series
The South African Wine Industry
South African wine producers , like their global counterparts , are left reeling from the negative effects of the Covid-19 pandemic on the industry . An initial ban , imposed when lockdown commenced at the end of March , lasted for nine weeks – and for five of those weeks , wine exports were also banned . On 12 July , amid soaring rates of Covid-19 infections , President Cyril Ramaphosa reimposed the ban on the sale , dispensing and distribution of alcohol .
Annette Willemse Communication Specialist
STABILITY NEEDED IN A LONG-TERM INDUSTRY In light of this , the fourteenth session of the Agricultural Value Chain ( AVC ) Virtual Discussion Series focused on the South African wine value chain , and more so its response to the current alcohol ban . Joining Agbiz ’ s Dr John Purchase were panel members Rico Basson , VinPro ;
Maryna Calow , Wines of South Africa ( WOSA ); Beyers Truter , Beyerskloof Winery and Hein Koegelenberg , La Motte Wine .
A LOCAL INDUSTRY ON ITS KNEES The sentiment of all panel members was clear : the decision to once again suspend alcohol sales dealt a devastating blow to the wine industry , which already suffered great financial and job losses due to a ban earlier in the lockdown .
According to Beyers Truter , the industry is under immense pressure and the negative effects are felt across the value chain . His sentiment is echoed by Hein Koegelenberg , who explains that the wine industry represents a long-term business and that the effect of the current crisis will be felt for at least the next three years .
VinPro Managing Director , Rico Basson , also paints a bleak picture when he states that already before the coronavirus crisis , about 30 % of local wine producers did not show any profit . Add to this the 22 000 jobs at risk within the sector and the possible loss of 400 producers ( which include niche players ), and it becomes clear why Basson is worried about a looming industry collapse . Basson further warns that if the sector does not stabilise in the long-term , it will soon face the brunt of a dire socio-economic and humanitarian crisis .
POSITIVE EXPORT MARKET With the ban on exports lifted on 1 June , indications are that the industry experienced a very positive export cycle in July . According to Maryna Calow , Communications Manager of WOSA , about 38 million litres of wine were exported in July and she remains positive that the export figures will continue to rise over the next few months .
All panel members are in agreement that South Africa produces exceptional wines and that the industry can hold its own amongst its international counterparts .
THE WAY FORWARD According to Basson , the industry is faced with three main challenges , namely : how to go about to get the ban lifted , to safeguard its reopening and to ensure a better regulatory environment .
The sector has subsequently entered into a social compact with government , industry and labour . Through this three tier approach , the sector aims to enhance the flow of communication between role players . This document is currently being lobbied for political buy-in .
In terms of the regulatory environment , Basson states that targeted intervention programmes are required and that the industry is ready to engage with government on issues pertaining to , amongst others , drinking and driving , the youth and alcohol and gender-based violence .
Another important aspect , according to the panel members , is the revival of the wine tourism sector . All are in agreement that although this sector is one of the industry ’ s strongest assets , it will have to be revisited to adapt to the new normal and a post-Covid-19 environment .
If you missed this fascinating discussion , log in on Senwes ’ website to watch it - http :// www . senwes . co . za / en-za / agri-valuechain .
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SENWES SCENARIO | LENTE � SPRING 2020