Wine industry cheers lifting of ban on exports during coronavirus lockdown
The wine industry, which contributes about R38bn to the country’s economy, is breathing a collective sigh of relief after the government lifted a ban on exports during the coronavirus lockdown.
Producers had feared that the ban would undermine an industry that supports 300,000 jobs by removing local wine from shelves in key markets such as the UK, Germany, the Netherlands and China, and at the same time entrench the positions of SA’s competitors.
The estimated cost of the ban on exports during the threeweek lockdown was R650m, while the industry also faced losing R800m in local sales, said industry body Vinpro.
While the sale of alcohol is banned during SA’s 21-day lockdown, bottle stores in the UK are classified as essential service providers and are allowed to trade.
Wine is SA’s most valuable agri-processed product, yielding direct annual export income of more than R9bn, according to government data. The 100,000ha of vineyards, mostly in the Western Cape, account for 4% of world production.
FRESH PRODUCE
The government this week decided to update regulations to permit the transport of wines and fresh produce through seaports and airports designated as ports of entry for export.
SA started a 21-day lockdown on March 27 as authorities battle to curb the spread of the coronavirus. The regulations aim to limit the movement of people, allowing providers of essential services such as health care and food to operate. When the initial regulations were published, the government banned most wine industry activities, including exports.
Vinpro said on Wednesday that the decision to lift the export ban would provide some relief to a sector that is likely to suffer severe long-term damage.
“The impact on the industry from the time the initial regulations prohibiting the movement of wine will be and is severe,” said Vinpro MD Rico Basson.
In addition to the immediate loss of export revenue, “the damage to reputation of consistent supply and future market will be astronomical and will be exponentially more than this figure”, he said.
Western Cape agriculture MEC Ivan Meyer said the lifting of the ban was good news for the wine industry and the province, which accounts for more than 90% of wine cellars in SA. The industry is “an important contributor to the agricultural economy in our province and a major creator of jobs in the Western Cape”, he said.
He said market access for agricultural products was a key strategic objective of the Western Cape government.
“I am looking forward to working with the relevant commodity partners to grow our export markets.”