High surplus of wine stock blamed on Covid-19 alcohol bans

Cape Town – The wine industry is currently sitting on between 250 million to 300 million litres of surplus stock and this surplus can largely be ascribed to the impact of the lockdown on domestic sales, says Agriculture MEC Ivan Meyer.

Meyer was responding to a question from standing committee on agriculture chairperson Andricus van der Westhuizen (DA), who wanted to know the extent to which repeated bans on the sale of alcoholic products, issued under Covid-19 regulations, contributed to the high stock levels of bulk wine.

“Domestic sales of wine declined by 20% during 2020, as a result of lockdown measures introduced on March 25, 2020, and the domestic sale of wine being banned for 21 weeks.

“During a further nine weeks, only off-site consumption was allowed and that was for limited hours only. The result is that no on-site consumption, including wine sales in restaurants, were allowed for 30 weeks after lockdown started.

Meanwhile, the 2021 wine grape crop is estimated at 1 461 599 tonnes, according to the latest estimate of industry body SAWIS (South African Wine Industry Information and Systems) on May 19, 2021. It is 8.9% larger than the 2020 harvest.

Vinpro managing director Rico Basson said: “With so much stock still in the tanks at the beginning of harvest time, producers and wineries were concerned about processing and storage capacity, when taking in the new harvest.

“However, the fact that sales reopened, along with the harvest starting later than normal, helped ease the pressure to some extent.

“A number of wineries have since been able to secure contracts with grape juice manufacturers, which is helping work away some of the stock,” said Basson.

[email protected]

Cape Argus