SA wine industry has shot itself in the foot, says local winemaker
From economic pressures to climate change and shifts in consumer preference, the local wine industry is facing significant challenges.
Stephen Grootes speaks to Wade Bales, owner at Wade Bales Wine Co. about the challenges facing South Africa's wine sector, from global competition and rising production costs to climate change and transformation issues.
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Wine master Tim Atkin's 2024 South Africa Special Report suggested that while South Africa is making the best wine in its history, many bottom-end players are struggling to make a consistent profit.
The comprehensive report released back in September takes a deep dive into the local wine industry.
Atkin surmised that while the standard of wine continues to improve, it is still too cheap for the industry to be sustainable.
Bales agrees and says both locally and globally it's a tough nut to crack.
"It's a highly competitive marketplace".
Wade Bales, Owner - Wade Bales Wine Co.
And the weak rand provides a double-edged sword for wine makers, says Bales.
"Obviously it benefits exporters with the weaker currency, but then we also have to import input costs such as barrels and equipment, so what you gain on the one hand you lose on the other..and inflation is a factor."
Wade Bales, Owner - Wade Bales Wine Co.
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Bales says producing costs, which have traditionally been lower than other wine making regions in the world, are starting to increase in line with other markets.
"Generally South Africa is a low cost producer, relative to California or Europe where the cost of land is far higher, but that's changing.The prime growing regions are becoming very sought after and prices are being driven up."
Wade Bales, Owner - Wade Bales Wine Co.