The financial sustainability of primary grape producers impacted negatively by the initiation of the drought conditions, with positive short term prospect as world wine supply tighten.
According to the latest vinpro production plan survey, primary wine grape producers’ are still under financial pressure as the drought spreads and production cost inflation grips firmly on already dwindling margins.
In 2017 the Vinpro Production Plan survey was conducted for the 14th consecutive year in the wine industry. The findings show that although the average producer are still not on sustainable income levels, the most profitable producers are gaining margin in all 10 producing regions, however the unprofitable bottom third are increasing for the third consecutive year, a further increase is expected if the current drought conditions prolong.
With tightening global wine supply there is an opportunity for Brand SA to re-position itself in the market, ensuring a much needed structural correction along the wine value chain.
ENQUIRIES: Elriza Marcus at tel 021 276 0429, e-mail elriza@vinpro.co.za
