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Vinpro: “Still a long road to recovery”

Published:  17 August, 2020

Vinpro has “acknowledged” the announcement it can resume local trade and distribution of alcohol under alert level 2 from midnight 17 August 2020, but said the industry still has “a long road to recovery”.

In response to the announcement, made by President Cyril Ramaphosa over the weekend, Rico Basson, MD of the wine industry body, said: “Although we are grateful to start trading and delivering online sales again, we are dismayed at the extent of the damage caused to our industry during the temporary ban on exports and extended restrictions on local sales.”

But it might be “a little too late”, he said. “Many wine businesses have already closed down and a long road to recovery lies ahead for the industry as a whole.” 

The industry is believed to have lost more than R7bn since the introduction of sales restrictions in March 2020. 

Following the initial nine week ban on local sales, five-week ban on exports and a second domestic sales ban, Vinpro estimates more than 80 wineries and 350 wine grape producers will go out of business over the next 18 months, with a potential loss of more than 21,000 jobs.

Vinpro has been working closely with industry partners on a disaster recovery plan to address the urgent need to stabilise the sector, including the extension of further excise relief for the current year, as well as the 2021 season, addressing bottlenecks and challenges at the Cape Town Port and formulating solutions to reduce a current wine surplus of around 300 million litres. 

“The wine industry is geared to reopen domestic trade and distribution with all necessary health and safety regulations in place, while focusing on changing behaviour with regard to responsible production, promotion, trade and consumption,” said  Basson. 

In July, South Africa’s hard-pressed wine industry greeted the renewed ban on alcohol sales with dismay, with Vinpro describing the government-imposed clampdown as a “devastating blow”.

At the time, the organisation issued a statement condemning the lack of engagement or warning for producers ahead of the second ban, which followed an earlier five week ban on exports and nine week ban on domestic sales during the early Covid-19 lockdown.