A tippling good year
Excellent wines for 2009
THIS YEAR COULD PRODUCE the best vintages of the decade, thanks to last year’s good rains and subsequent cooler weather, which resulted in a long ripening process and high quality grapes. That would be an appropriate achievement to mark the 350th anniversary of South Africa’s wine industry.
Absa AgriBusiness GM Ernst Janovsky says he’s excited about the prospects of SA’s wine industry producing exceptional quality and good volumes this year. “While the international recession could put a damper on the demand for premium wines, I don’t think it will really affect the demand for cheaper wines, both in SA and overseas markets. People tend rather to look for cheaper options. Also, we’ve seen in the past that people actually drink more in periods of recession and wine is relatively cheap compared with other drinks.
“However, over the long run SA will lose market share, because we’re having problems establishing 1 000ha of new grapes each year. Competitors, including Chile and Peru, easily plant 30 000ha to 40 000ha every year. But SA’s good and established brands do help SA’s wine producers hold their own internationally. The weaker rand could also encourage exports and the reduction of high stock levels this year, which will in turn ease prices for SA’s wine producers,” Janovsky says.
Latest estimates put the 2009 wine grape crop at 1 321 877t – about 7% down on the record crop last year. The stock level in producer and private cellars will fall to an estimated 332,7m litres at year-end 2009, from 401,1m litres on 31 December 2008.
Wine estate Fairview’s Charles Back says it remains difficult for SA’s winemakers to gain entry to the United States market due to its negative perceptions about Africa. In American eyes SA is lumped with the rest of the continent. “The result is that winemakers have to put a bottle of wine worth US$15 on the market for $10 in order to offset those perceptions.”
SA has a further problem: that its wine is too expensive due to the geology (mountain ranges) of the Western Cape, which has a range of climates and soil types that makes it impossible to produce large quantities of homogeneous wine. SA’s producers are consequently forced to focus on niche markets.
Back says the fragmentation of the US market has its own problems. Each state has its own rules and regulations. “Despite what’s generally assumed it’s not so much figures that count for the Americans but relations. Our strategy is to bring 30 influential Americans to SA every year and expose them to what the SA wine industry has to offer. It’s also important to have a presence in the US.”
Beyers Truter, of Beyerskloof, who is also the chairman of the Pinotage Association, says the 2010 Soccer World Cup will offer wonderful opportunities to market the SA wine industry and, specifically, Pinotage – a uniquely SA type of wine. Pinotage was created in 1924 when Professor Abraham Izak Perold successfully crossed pinot noir and cinsaut grapes (then known as hermitage).
Though Pinotage has been neglected in the past, it’s a wine type that’s earned some of the world’s top awards for SA over the years. The production of Pinotage wines was given a huge boost with the formation of the Pinotage Association in 1995 and the Absa Top 10 Pinotage Competition in 1997, which resulted from it.
Says Truter: “There really was a need for a body to promote Pinotage. I sent out 200 letters and 200 people turned up. The association rests on a number of foundations, the most important being definitely the quality of the wine, the free exchange of information and marketing.”
Absa’s Top 10 Pinotage Competition doesn’t have an overall winner but 10 finalists are announced alphabetically, so that the publicity is spread over 10 Pinotage wines.
Truter is excited about the opportunities offered by both the SA market and Africa as a whole. “The SA market has 47m people and we traditionally sell wine to 7m. There’s a whole new world waiting for us to open. We’ll have to do research on wine styles and packaging to gain a larger share of that market. In Africa, there’s Angola and Mozambique, which have enormous potential at all price levels. The same further north.”