Can African Wines Break into New Global Markets? the Drinking of Wine Has Traditionally Been Associated with European Culture but This Is Now Rapidly Changing as the Beverage Finds Increasing Favour in the East - and in Africa to Some Extent. Can the Continent's Wine Producers Cater to This New Taste and Find Exciting New Markets for Their Products? Richard Seymour Reports

By Seymour, Richard | African Business, December 2011 | Go to article overview
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Can African Wines Break into New Global Markets? the Drinking of Wine Has Traditionally Been Associated with European Culture but This Is Now Rapidly Changing as the Beverage Finds Increasing Favour in the East - and in Africa to Some Extent. Can the Continent's Wine Producers Cater to This New Taste and Find Exciting New Markets for Their Products? Richard Seymour Reports


Seymour, Richard, African Business


WINE MAKING HAS ITS ROOTS flRM-LY entwined within human civilisation itself. For thousands of years, people have cultivated the grape, drunk its fermented juices and they liked it so much they created gods, such as Bacchus, in dedication to it.

Millennia later, the global market for wine is vast and the demand for alcoholic beverages as a whole is predicted to rise over the next decade. Wine, which currently makes up a relatively low proportion of consumption compared to beer and spirits, it is thought, will eat into the market share of its more dominant rivals. The reasons for this are varied. Among them are wine's health-giving properties when consumed in moderation.

This growth in the demand for wine is being driven by lifestyle changes in emerging markets brought on by greater affluence. Demand from China is leading the surge, but so too are the tastes of consumers in Russia and India, potentially adding many hundreds of millions of drinkers to the established historical centres of wine lovers in Europe - still by far the largest market - and North America, which have shown a decline in wine consumption in recent years.

France is still the world's dominant wine producer, a position it recently regained from Italy. But Europe's 'Old World' wine makers have been facing increased competition from the 'New World' - Australia, South Africa and Chile among them.

However, it seems that 'Old World' wine, especially French, has consolidated its position by being swifter to take advantage of the emerging markets, most notably China. It seems the historic brand of French wine is more appealing to the new consumers in the East. Climate change is perhaps the single most important factor that the wine industry has to manage over the next 50 years and beyond. It has the potential to change the face of wine production forever, and signs that this is happening are already visible.

It is feared, for instance, that the Champagne region of France may soon be too warm to produce Champagne. Indeed, Champagne grapes are currently being grown to an acceptable standard in Britain.

South Africa's vintners are grappling with the issue of climate change. The nation's centuries-old wine industry is the most established on the continent. According to the Wines of South Africa organisation, the country is seventh on the list of the world's largest wine producers. One report has found that South African wine is now more popular in the UK than its French counterpart.

Wine centres shifting

Traditionally, South Africa's climate - similar to the wine-growing regions of the Mediterranean - has been well suited to wine growing. The dry summers and cooling ocean breezes delayed the ripening process.

But in recent times, rain during the best time for harvesting grapes has led to the risk the fruit will rot and has forced South Africa's vintners to begin their harvests early, which produces, essentially, a different wine.

All businesses need to adapt to market trends and be able to diversify. However, replanting a vineyard is an expensive process and, more to the point, a replanted vineyard takes years before it produces sufficient yield and even longer to return to profit.

Thus expanding into multiple markets will help South Africa's wine makers ensure there is always a demand for their product. Most tantalising in that regard is China, which is now the world's seventh largest consumer of wine by volume.

Other well-established wine industries in Africa are to be found, not surprisingly, on the Mediterranean. The Maghreb region of North Africa has a wine-making tradition that goes back thousands of years. The three countries of this region, Tunisia, Morocco and Algeria, benefit from a good grape-growing climate, similar to that in Spain - itself a major producer.

However, despite its long history of wine making, favourable conditions and the occasional wine being recognised worldwide, the region's industry has failed to make a significant impact on the global market.

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Can African Wines Break into New Global Markets? the Drinking of Wine Has Traditionally Been Associated with European Culture but This Is Now Rapidly Changing as the Beverage Finds Increasing Favour in the East - and in Africa to Some Extent. Can the Continent's Wine Producers Cater to This New Taste and Find Exciting New Markets for Their Products? Richard Seymour Reports
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