Despite a decline of 5% in export volumes, the South African wine industry remains focused on its road to recovery following the pandemic. It is positive to see that export value has only seen a 2.4% decline, with Rand per litre on a whole, showing marginal growth as producers navigate rising costs, shipping challenges and shortages in the supply of packaging goods.
A total volume of 368.8 million litres of wine left our shores in 2022, some 20 million litres less than in 2021. These exports totalled R9.9 billion Rand in value, down from R10.2 billion in 2021. The decline can mainly be attributed to shipping constraints at the port of Cape Town, in particular an extended period of adverse weather conditions, as well as the two-week-long period of strikes by port workers in October.
The total price per litre increased by 2.2%, mainly supported by the 5.3% increase in bulk Rand per litre – yet another positive step in the direction of premiumization for both packaged and bulk wine categories. Bulk wine exports equate to 62% of total export volumes, however in terms of value contribution, packaged wine is by far the value-leader at 77%.
The UK, South Africa’s largest wine export market, where the perception and quality offering of South African wine has grown over the past decade, continued to show growth of 5% in volume. The Chinese market, which previously showed exponential growth for South African wine, has slowed down due to the extended extreme lockdown measures imposed by the Chinese government with the total exports value decline of 26% and volumes of 38%.
In our second-largest market, Germany, a decline of 17% in value and 9% in volume could be attributed to: rising inflation in Germany, increase in living costs, an emerging culture of drinking local wines, lack of tourism to South Africa, an area that has previously fostered long-standing relationships with consumers and the wines of South Africa.
