‘Time to increase the price of SA export wines’

If ever there was a time to increase the price of South African export wines it is now. This is according to Siobhan Thompson, Wines of South Africa (Wosa) CEO, who said while it was up to each and every producer to set their own pricing, internationally the prices farmers were receiving were low. This comes in the wake of a Vinpro report stating
that wine-grape producers remain under severe financial pressure with as many as a third making a loss. “It is imperative that the prices paid for South African wine enable our producers to farm sustainably,” said Thompson. “We have seen  a major decline in  producers and planted vineyards over the past 10 years – and the main reason for this can be linked directly to profitability for
the farmers.” It is estimated there are about 25% fewer wine producers now than a decade ago. According to Vinpro some producers are selling wine in bulk for less than R5.50 per litre internationally. South Africa accounts for  around 4% of the world’s wine production. The wine producers’ body is in agreement with Wosa that any attempt to hike prices has to happen now due to the international
shortage of wine stock and the fact that current market forces demand an upward push in South African wine prices. These low stock levels, said Vinpro, would provide just the right opportunity for South Africa to raise the bar in terms of its pricing. Producers have for the past two years already been increasing their prices. Bulk wine prices have increased between 35 and 50% and packaged wine about 10%. “The tide is slowly
changing, however we believe that confidence is a key factor in this regard,” said Thompson. “The SA producers need to be confident in themselves and the rest of the world needs to understand that by buying South African wine they are indeed investing in quality produce – and that our positioning is no longer that of producing cheap and cheerful wines. We have the quality and can rightfully demand the prices. The time to do this is now.”