Bright horizons for SA’s wine industry

The South African wine industry looks set to have yet another good year ahead. Harvest estimations show that 2008 will be, for the third consecutive year, unexpectedly prosperous.

The 2008 harvest is three quarters complete. Some areas in the Western Cape have had problems due to too much rain, however, a yield of over 1.3 million tons is expected.

Two consecutive drought years in Italy and Australia have created several opportunities for the local market. South African wines are doing well, especially in the middle and high price categories.

Exports are 16% up from last year, and unexpected new markets have the local winemakers excited.

Inset costs, however, increase sharply every year. This, combined with rising petrol prices, make it harder for the industry to sustain growth. But with the current weak rand and the high demand for local wines, many farmers are still assured of a profit.