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Local wine industry blooms as more of the world seeks SA’s wines

| Wine and liquor

South African wine exports are projected to grow 13% in the next decade, according to the latest Bureau for Food and Agricultural Policy baseline report, which provides a snapshot of the country’s wine industry and the broader agricultural sector.

The bureau’s annual report, produced by researchers from the Universities of Pretoria and Stellenbosch as well as the Western Cape Department of Agriculture, says wine exports reached 313-million litres in 2015, up from 122-million litres in 2000.

The Western Cape produces more than 50% of SA’s agricultural exports, with the EU being the wine industry’s biggest export destination — it accounts for almost 75% of annual offshore sales volumes, worth R5bn.

SA’s nearly 100,000ha of vineyards, mostly in the Western Cape, generate about 3% of the world’s wine production. Other major export markets include the US and China.

Western Cape economic opportunities MEC Alan Winde said that exports to key markets in the rest of Africa, the US and China were growing.

South African wine sales to China rose almost 30% in 2015, according to statistics from South African Wine Industry Information and Systems.

"As part of our Project Khulisa (the province’s economic growth strategy) we have set ourselves the goal of boosting wine exports to strategic markets and the latest trends are excellent indicators," said Winde.

According to report by the Bureau for Food and Agricultural Policy, the South African wine industry incorporates 100,000ha, and comprises of 3,300 producers. It supports employment for close to 300,000 residents, directly and indirectly.

Winde said the South African wine industry had formulated the Wine Industry Strategic Exercise, which set clear goals for the sector. This includes boosting jobs to 375,000 by 2025 and growing the value of wine tourism from R6bn to R15bn.

Transforming the wine industry was a vital part of the strategic exercise, said Winde.

The importance of negotiating smart trade agreements was also highlighted in the baseline report. It was found that removing tariffs in crucial markets would be a key contributor to increased wine exports.

Earlier this year, SA and other countries in the region concluded a trade pact with the EU. The Economic Partnership Agreement with the EU will allow SA to export 110-million litres of wine to Europe, up from the current annual duty-free quota of 48-million litres.

The industry is also focused on shifting export product from bulk to packaged, and on boosting value through a focus on quality and targeted marketing drives.

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