jamie goode's wine blog: South Africa's strong performance in the UK

Wednesday, January 20, 2010

South Africa's strong performance in the UK

Just got these latest stats through on the performance of South Africa in the UK market. Quite amazing really, especially seeing as South Africa has the handicap of significant vineyard area being wasted by means of being planted to Pinotage. [That last sentence was intended as a wind up.]
  • South African wine achieved the largest increase in UK market share during 2009 (10.4% of market to 12.3%, off-trade by volume)
  • South African category grew by 24% in value and 23% in volume for the same period
  • South Africa’s market share is now only 0.1% behind France, which is in decline
  • Exports to the UK were up 14% by volume, maintaining the UK’s position as the leading export market for the South African wine industry (so perhaps South African journalist Neil Pendock should cease his mean-spirited crusades against WOSA and UK journalists in general?), accounting for 32% of total global exports
  • Success from South Africa’s top brands helped to drive the category: FirstCape, Kumala, Arniston Bay, Two Oceans and KWV all grew significantly
  • But it's not just cheap wines doing well. There was an uplift of 15% by value above £5, a 27% increase above £7, and a 43% increase above £10



At 1:59 PM, Anonymous Anonymous said...

No surprise at all for me, and reflected in my own purchases.

The clear reason, I feel, is largely down to the fact that the rand is the only currency of a wine-producing country which has not appreciated significantly against the pound (to be known henceforth as "the British peso") over the last year or so.

Not that the wine isn't good, of course, but the same is true of a lot of other places.


At 2:48 PM, Anonymous Andrew said...

I agree with Mark about the exchange rate working in South Africa's favour. Many wines from other countries that retailed at £6 - £7 a couple of years ago are now pushing £10. That's too much for "everyday drinking" fair. Once the price enters double figures I want to be able to taste a real step up in quality and this is becoming the case less often.

Sadly (although not for South Africa), with the Euro and Australian Dollar in particular likely to remain strong compared to sterling for the foreseeable future, this trend looks likely to continue.

At 2:52 PM, Anonymous Keith Prothero said...

Its partly due to the currency but mainly the huge improvement in the quality of Cape wines,over the last 10 years due to enormous foreign investment and of course highly talented local winemakers,who are now able to express themselves without the constraints of the apartheid era..Many of the latter have gained experience working harvests all over the world.
The future for the industry is bright especially for those wineries who get off their backside,and market their wines themselves,and do not rely solely on importers and/or WOSA to do the work for them.

At 3:09 PM, Blogger Tim Pearson said...

Whilst I agree with what Mark has said about the £ / Rand exchange rates this does not answer the whole of the question. South Africa has upped the anti in all price areas. The lower end has seen supermarkets discounting heavily South African wines. But the main reason for the success of higher priced wines is an increase in overall quality, brought about by investment in the industry and excellent winemakers. This includes foreign as well as local investment.
I feel that WOSA has been a mediocre performer (tried hard but could do a lot better) but individuals driven by quality and vision are moving this market forward.
There are many talented people in the Cape...watch this space.

At 5:48 PM, Anonymous Anonymous said...

Jamie - are you available to fly First Class to Hong Kong on Friday 26th February to come to my michelin-starred restaurant for a tasting of DRC ?

At 7:25 PM, Anonymous Laurence said...

South Africa has also benefited (and will do so still) from lots of 'soft' marketing. The Lions and England Cricket tour have, and the World Cup will, all focus attention on South Africa and its wine sales have/will benefit.

At 8:07 PM, Blogger TommyB said...

Hi Jamie; I'm getting convinced you hate Pinotage?! Is that true?!

At 1:15 AM, Blogger Martin said...

And of course all these winery improvements and winemaker experiences have led to a massive decrease in Brettanomyces, so at last we can taste true ‘South African character’ of these wonderful contemporary wines. Massive work still needs to be done in the vineyards to catch up with what has happened in the wineries, so it will be fascinating to see just how much better these already good wines get.

At 9:18 AM, Blogger Tim Pearson said...

Good comment Martin about work in the vineyards and the Brettanomyces issue(caused by an unwelcomed yeast which causes wine to have a farmyardy / cheesy character), but I can tell you that it is being done. There have been problems with leaf roll virus in some vineyards, a problem which is being dealt with. New plantings are taking place in less traditional, cooler areas, such as Elgin, Walker Bay and Elim etc. In these 'newer areas' plantings Sauvignon Blanc, Pinot Noir, Chardonnay and Syrah are producing excellent expressions of these varietals. These are varieties we have planted in our new vineyard, Seven Springs, near the seaside town of Hermanus.

Also 'unfashionable' areas such as the Swartland are producing some wonderful whites and reds from Syrah blends and Chenin based white blends. Look at Mullineux Wines for a glowing example.



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