With 2021’s grape harvest in the southern hemisphere just around the corner, and without access to regular sales channels for their wines, producers are left with significant amounts of inventory on-hand that may go to waste because of storage issues.
Those concerns, plus the loss of direct sales to consumers that have also been restricted, exacerbates an already-challenging economic situation for winemakers in the Western Cape and wine-affiliated businesses throughout South Africa.
It seems non-sensical, to repeatedly ban the sale of alcohol country-wide and tie it, at least rhetorically, to concerns around COVID without consideration for the far-reaching financial impact that reverberates throughout the entire beverage alcohol industry. Today’s post dives deeper into three fundamental questions to try to reach a better understanding: What is the rationale behind the bans? How is the wine industry as a whole reacting? And how has the situation impacted South African wineries, both big and small?
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What is the reasoning behind the government’s repeated bans on alcohol sales in South Africa?
Demands on medical personnel and the health system nationwide is a frequently-cited reason. Without the sale of alcohol, the rationale goes, there will be fewer patients at hospitals and trauma units due to a reduced number of traffic accidents and violent crimes. If there are fewer urgent trauma patients, then more medical personnel and hospital beds can be redirected to the treatment of COVID patients. Research is already underway to study whether this is actually happening.
How is the wine industry reacting?
Last week, on January 15, multiple wine industry organizations sent an open letter to to South Africa’s President Cyril Ramaphosa. The letter captures candidly these tense moments of desperation that the organizations, and their constituents throughout the country, are currently experiencing. Several notable takeaways include:
“...the current restriction on the sale of table wine is having a devastating impact on our industry and all of the many related ancillaries, transformation initiatives, community upliftment projects and jobs! Whilst we acknowledge the distressing consequences of this rising wave of the COVID-19 pandemic and the critical availability of hospital beds, we implore you to work with us to explore alternative mechanisms, for which there are precedents, to reinvigorate our industry.””
This pandemic has highlighted the role we can play to further educate the South African public to become responsible wine consumers and we hereby volunteer our services to be committed ambassadors for our beloved country.”
“Mr. President, the South African wine industry plays a vital role as an employer in the agricultural and food sectors, but also throughout the value chain creating more than 265 000 jobs: affecting sommeliers, wine farm representatives, suppliers, restaurant, retail and tasting room staff, wine educators, garagistes, wine journalists and media workers – and all their families and dependants. We contribute more than R55 billion or 1,1% to the GDP of South Africa and ensure a positive effect on the balance of payments through significant exports. In various rural economies, the wine sector is the backbone of communities and towns.”
What about individual producers? How has this impacted wineries of various sizes?
The namesake of Bruce Jack Wines wrote an extensive narrative for UK-based TheBuyer.net, on the human and industry costs of COVID-19 from his perspective in South Africa and as a global brand. Rico Basson, Managing Director of Vinpro (a non-profit organization that represents and advocates for 2500 South African wine businesses), frequently updates his personal Twitter account with helpful, accurate information; the Vinpro account is also a useful resource for updates.
On a smaller scale, Carolyn Martin of Creation Wines in the Walker Bay region regularly offers her ground-level perspective through newsletters and blog posts on the winery’s website. Martin recently wrote that, under the latest government ban that lasts until February 15, Creation won’t have been able to sell their wines locally for 22 weeks out of the current financial year. Tourism is a significant source of revenue for the business (and the South African industry overall) but Creation has had to close their tasting room, which creates a hardship both for the winery and its direct employees.
As they look ahead to harvest in just a few weeks, and the pressures of its own that that time brings, Martin and other producers in the region work to bolster international sales through a global network of South African supporters at the retail and, where possible, restaurant levels as well.
I'm an entrepreneur in the wine tech space, and a journalist who's especially interested in the business and politics of wine. My writing and photographs have appeared
Cathy Huyghe
