M A R K E T S extracted from Statistics on www.wosa.co.za
Although South African vineyards account for just 1.4% of the world’s vineyards, the country ranks as the seventh largest producer of wines, producing 3.6% of the world’s wine on 252,000 acres. The 2011 harvest is estimated at 974 million liters : 80% was devoted to making wine, 3% to brandy, 13% to distilling wine and 4% to grape concentrate. Varietals that showed the most growth in 2010 were chardonnay and shiraz.
Approximately 222 million liters was exported in 2010 - a 6% decline from 2009. Red wine exports decreased by 7.0% to account for 50% of all natural wines exported. The three top markets for SA packaged wines are the UK, Sweden and Germany; all of which accounted for 56% of SA wine exports in 2010 (jan - jun).
The UK remains South Africa’s largest export market by far, taking some 31% of the total wine exports. While this is down significantly from 53% in 2002, South African wines continue to increase their market share, reaching 7% of the UK market and now ranked as the 4th largest supplier of wine in the UK. For perspective, the top two wine exporters to the UK are Australia with 23% of the market and France with 21%.
Wines of South Africa (WOSA ) is a fully inclusive body representing all of South Africa’s producers of wine who export their products. Founded in 1978, it is totally independent of any producer or wholesaling company. The WOSA mandate is to promote the export of SA wines. WOSA is funded from two sources: a levy per liter on all wines exported and contributions from the South African Wine Industry Trust, which was established in 1999 by the government from the KWV restructure.
WOSA activities include participation in trade shows and wine fairs, most notably Mondial Bruxelles, ProWein Germany, the London Wine Trade Fair, Vinexpo France and Japan, Vinordic Stockholm, Boston Wine Expo, Washington DC Wine Festival, World Wine Market in San Francisco amongst others. WOSA also hosts the Cape Wine Expo held bi-annually at the end of March.
The longer term strategy for South African wine is encompassed in Vision 2020, a planning initiative that embraces all the major players in the industry from producers to researchers and marketers. Vision 2020 is the industry’s response to the deregulation of the KWV, which governed much of the 20th century with a system of statutory controls. While such a system provided clear guidelines to producers and other stakeholders, it impeded free market growth and encouraged volume production rather than quality.
The goal of Vision 2020 is to increase the expertise of industry participants in order to produce quality wines in a cost effective manner, to support research, training and education and to further a culture of technological innovation.
Oz Clarke said of the SA regulatory system : “The South African ‘appellation’ system is the most highly organized of all the New World countries, and applies to the whole wine industry.”
In 1973, the government introduced an elaborate system of control for “Wines of Origin”. These regulations were based upon European classification systems. There are strict rules for the use of the terms Estate, vintage dates and grape variety. All estate wine is grown, made and produced on the property of the estate.
Until 1995, estates were not allowed to buy in any grapes. Now they may buy in grapes or wine up to 45% of the estate production but are required to keep it separate and are not allowed to bottle the product under the estate label - it must be bottled under a second name.
Strict record-keeping by the governing industry bodies controls the winemaking process - from harvest to bottling. For example, all wine bottles are numbered, which must correspond with potential production and be reconciled back to the authorities, bottle for bottle.
Exported wine must be tasted, tested and approved for export by the authorities every twelve months.
If labeled as a single varietal for export, that varietal must constitute at least 85% of the wine. It is industry practice to maintain a 95% - 100% varietal correctness.
The alcohol statement must be accurate to the nearest 0.5% on export wines.
WINE OF ORIGIN
The Wine of Origin classification system was introduced in 1973. In terms of terroir, it is defined in ascending order: Estate, Ward, District and Region.
An Estate is a property consisting of one or more properties farmed as one unit with production cellars. If more than one property, then all properties must share the same climate and ecology, which is determined on a case by case basis with the authorities.
A Ward is a small, homogenous area normally within the boundaries of a District.
A District is a geographical demarcation.
A Region is an area larger than a District. It may be an area on its own, or in combination with Districts or parts of Districts.
There are five regions, 12 districts and 41 wards, each with a multitude of meso- and micro-climates. The appellations were determined according to geographic considerations. The system is currently being reviewed to assess other means of accurately reflecting terroir.
While other wine regions in the world demarcate their appellations according to terroir, such delineation in South Africa is virtually impossible. The soil composition varies radically throughout the Western Cape, criss-crossing in all coastal regions. The mountain ranges and rivers heavily influence the weather patterns.
Winemakers tend to focus on the ripening period of the grape in different vineyards, wards, districts and regions. The ripeness reflects the climatic influences of the cool southeasterly winds, the amount of sun and rain, and the temperature of the specific area under consideration. Although the soil component is important in determining a wine’s quality, it is the hardest element to classify in the Cape appellation equation.