WorldWine Blog

2012-04-13

South Africa's export booms - trend towards bulk trade accelerates

Do you want the good or the bad news first, is a nearly inevitable question of some 95 % of all movies and tv shows, here in Germany. Well, in the case of the latest South African export numbers which have just been published, the good news is much more weighty: Wine exports are booming. And the bad news? The tendency towards bulk exports, at the expense of bottled shippings, which we have already analyzed several times, becomes more and more pronounced. 

Let's first of all consider the overall numbers. They differ quite a bit, according to wether you look at the year-to-year comparison or just at the first three months of 2012. The year-to-year comparison of the last 12 months only shows a modest export growth of about 1 % whilst the more up to date numbers of January to March 2012, compared whith the same period of 2011, show a growth of not less than 21 %. South Africa has exported, in the 12 months to march 2012, 3.65 m hl, compared with 3.61 m hl the year before. In the first quarter of 2012 exports amounted to 90 m hl, compared with only 73.9 the year before. If this tendency is to be confirmed for the rest of the current year, the total export numbers for 2012 should reach an absolute dream level.

Yet, the individual markets have developped quite diversely. Great Britain, which has dramatically lost in the year-to-year perspective (- 18 %), has stabilized in the beginning of 2012 (+ 7 %). Germany grows in both comparisons, yet a little bit less in the first-quarter comparison, whereas the US market has literally exploded in this same period (+ 375 %). Of the South African's most important export markets, apart from Germany, the USA, Denmark, Canada, Russia and France have been growing markets in the year-to-year perspective, Belgium has been stable, and Great Britain, as well als Sweden and the Netherlands have lost considerably.

In the first-quarter perspective, Germany, Great Britain, the USA, Canada, Russia, France and Belgium show positive figures, whereas Sweden and the Netherlands loose even more ground and Denmark goes down as well. The US, in this perspective, have rapidly overtaken Sweden and the Netherlands and could well become a stable third export market for the Cape vintners.

Growing importance of bulk exports

Nearly all of the South African top export markets show rapidly growing numbers of bulk shippings, whereas the bottled exports diminish. Just Germany and Kenya show growing bottled imports as well, which should be an encouraging tendency. Particularly dramatical has been the first-quartal growth of bulk exports to the US: + 2,824 %!! This is a development which also makes it increasingly difficult to exactly determine in which countries wines are ultimately consumed, as we know that a consistent percentage of the bulk volumes in the international wine trade are bottled and then re-exported. In Germany, just to give one example, more than half the total volume of exported still wine is actually re-exported wine of foreign origin.

Much easier is, on the other hand, the interpretation of the really succesful types of wine respectively varieties coming from South Africa. There is a clear tendency towards white wines (+ 8.6 %) whilst red wines are slightly (- 3.5 %), rosés rapidly (- 12.1 %) loosing ground. Chardonnay and Sauvignon seem, at present, particularly popular, and Chenin blanc maintains its position - it still is by far leader of the pack. As far as red wines are concerned, Pinotage shows a positive trend (+ 55.5%) whilst Cabernet Sauvignon is receding (- 10.8 %). The most exported red variety remains Syrah/Shiraz, followed by Cabernet, Pinotage and Merlot. One very interesting point is that, looking at the white varieties, only three of them make up for about 58 % of all exported white volumes, whereas the four (!) top red varieties sum up to only about 35 % of all reds.

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