CAPE TOWN – South Africa has lost about 1 000 wine grape producers in the last decade, while vineyards were getting fewer, and the wine industry is set to be in serious trouble if farmers don’t get paid more for their harvests.
This is according to Anthony van Schalkwyk, sales and marketing manager at Kleine Zalze wine estate in Stellenbosch.
Van Schalkwyk was speaking at the Wineland Adams & Adams Seminar 2018 at the Allée Bleue Estate near Franschhoek yesterday.
Analysing the figures from South African Wine Industry Statistics (Sawis), he said the conclusion was that if the growers were not paid more for their grapes, the industry would be in a lot of trouble going forward.
“There were 315 cellars in 1998 and in 2017 we had 546, it grew quite nicely up until 2006/2007, so that’s been quite consistent but look at the primary producers.
"Even if you take it from the last 10 years, we went from about 4 000 to 3 000, so we’ve lost 1 000 primary produces, which for me is quite a scary statistic,” Van Schalkwyk said.
He said about 7 000 hectares of vineyards was lost over the past 10 years.
“The scary fact is that we are going to lose about the same amount in one year, so things aren’t going well and production will increase, so what do you do? The crops must get more, the quality will get affected. It will be a dog versus dog environment where people will start to pay more,” he pointed out.
Van Schalkwyk said that another scary statistic was the uprooting of vineyards last year. There were a lot of smaller producers who were planting but it is volumes that count at the end of the day.
“The uprooting is probably one of our biggest problems. It’s nice for kaggel (firewood). We had some virus infection and had to pull a lot out. But jokes aside, going forward is where we should be concerned."
He said they were hoping for a better year. “Gradually production will decline because our vines are disappearing,” said Van Schalkwyk.
He added that according to Francois Viljoen, from Vinpro, this year would be one of the most challenging years faced by the industry.
Van Schalkwyk said while about one in five producers in South Africa were making a profit, one in three were running at a loss.
Stellenbosch had about 8 percent of wineries that were making a profit, whereas the others were breaking even or running at a loss.
Van Schalkwyk added that global wine production fell by 8 percent last year, the worst wine shortage in 50 years.
Looking at the local market, he said about 84 percent of wine in South Africa was sold for below R35 a bottle.
The average bulk wine price was set to increase by 15 percent to 20 percent this year and 15 percent next year.
- BUSINESS REPORT