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South African wine exports achieve modest growth
In a global wine market that’s been swirling with contracting consumption and economic uncertainties, South Africa’s wine export sector has managed to pour itself a glass of modest but commendable growth, according to the latest report from Wines of South Africa (WoSA).
CEO Siobhan Thompson revealed that South African wine exports saw a 4% increase in value year-on-year, reaching US$562 million, despite volumes remaining relatively flat at 306.2 million litres.
Packaged wine leads the way
Packaged wines were a significant driver of growth, with export sales rising 4% in value to US$430 million on 123.4 million litres, marking a 5% increase in volume. Bulk wine sales also grew in value, increasing by 6% to US$132 million, though volumes dropped by 3% to 182.8 million litres.
Thompson praised the growth in packaged wines as vital for enhancing South Africa’s reputation in international markets. Key export destinations such as the Netherlands, Canada, and Japan saw strong growth, alongside promising developments in African markets like Tanzania, Zambia, Ghana and Mozambique.
The global wine market landscape
The report noted a sobering 10% decline in global wine consumption between 2008 and 2023, with the International Organisation of Vine and Wine (OIV) highlighting that major markets like the UK and the US are drinking less per capita. In the UK, South Africa’s largest export market, wine consumption peaked in 2009.
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Meanwhile, in the US, the world’s biggest wine market by value, declines have been evident since 2017. These trends, already underway, have been worsened by geopolitical tensions and inflation, leaving many wine lovers with fewer pennies to uncork their favourite bottles.
Cultivar performance and strategic shifts
Bulk wine exports experienced growth in premium cultivars such as Chardonnay, Sauvignon Blanc, Chenin Blanc, Shiraz, Pinotage and Merlot. Thompson said this shift from generic categories like “dry white” and “dry red” to specific varieties is a sign of increasing discernment among consumers, which could potentially lead to higher pricing.
Rico Basson, CEO of South Africa Wine, commended the resilience of the sector amidst challenging conditions, including small harvests and structural reductions in vineyard capacity. “We are planting wiser and enhancing our climate resilience by introducing drought-resistant varieties,” Basson said.
Insights from the 2024 South African Wine Industry Information & Systems (SAWIS):
- Top markets by value: The UK remains South Africa’s largest export market at R2.6 billion, though it experienced a 6% decline. Notable growth was seen in the Netherlands (+19%), Sweden (+10%), and the UAE (+38%).
- Top markets by volume: While the UK leads in volume at 87.3 million litres, the Netherlands (+18%) and Sweden (+18%) showed the strongest growth rates.
Cultivar exports showed mixed performance:
- Notable increases: Sparkling wine (+34%), Cap Classique (+19%), and Blanc de Noir/Rosé (+11%) exhibited the highest percentage gains.
- Declines: Bulk categories like dry white (-17%) and red blends (-11%) faced notable decreases.
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