S. African Wine Exports Gain Most in 5 Years on Weakening Rand
South Africa’s wine exports increased the most since 2008 in the first half, boosted by a better harvest and a weaker rand that made the price of locally produced goods more attractive, an industry association said.
Total shipments climbed 40 percent in the six months through June, the biggest first-half advance in five years, Su Birch, chief executive officer for Wines of South Africa, said by phone from Pretoria today.
“The weaker rand was the major driver behind the bulk-wine exports,” she said. “There was also a global imbalance because the Europeans have been short on wine due to a bad crop, while we had a good crop.”
The rand has declined 15 percent against the dollar and 14 percent versus the euro this year, the worst performer against both of 16 major currencies tracked by Bloomberg. South Africa is the world’s eighth-largest producer of wine, accounting for about 4 percent of global volumes and Europe is its biggest export destination, according to the website of the industry body, known as WOSA.
Bulk-wine sales from South Africa jumped 66 percent and bottled wine exports rose 8 percent, Birch said. The U.K., Sweden, Germany and the Netherlands remain the four biggest markets for packaged wine, while sales to China increased 36 percent and to Nigeria by 50 percent.
“We expect that exports will remain good for the rest of the year but we could see a decline in early 2014 after the northern hemisphere harvests it crop,” Birch said.
Wine exports rose 25 percent to 469 million liters (124 million U.S. gallons) in the year through April from a year earlier, according to WOSA data released in May.
To contact the reporter on this story: Amogelang Mbatha in Johannesburg at email@example.com