Wine producer's evaporating income as lockdown ban continues to bite
“The ban on the sale of wine affects my total trading ability. It negates me as a business.”
These are the words of Schalk Burger Snr, owner of the Welbedacht Wine Estate in Wellington in the Western Cape.
He says the ban on the sale of alcohol has hit his business hard.
Burger's wines are produced and bottled on the farm.
“I grow grapes, put them in the cellar and sell high quality wine,” Burger says.
He said his business was not like those where one harvests and drops the grapes at a co-operative.
The government first banned the sale of alcohol on level 5 of the lockdown on March 27. However, the ban was temporarily lifted in April for two weeks before being reinstated.
Exports were permitted from May 1 and sales of liquor locally resumed on June 1, only to be halted again on July 13.
At least 80 wineries and 350 wine grape producers are expected to close their business in the next year.VinPro
Burger said when the first ban happened at the end of March, it came at a time when farmers were at a harvesting stage and needed to bottle their product.
“I have got no business. We could not sell to Europe. We could not get our wines to Europe. We could not get our products to the ships because space in the ships was given to the deciduous fruit guys,” Burger said.
Port congestion is also affecting SA's superfood producers, reports Business Times.
Burger said he exported about 30% of his product.
“How can we go on when we have missed all opportunities for European summer? We were not allowed to process. We could employ a third of the people.
“When we were supposed to send product to the UK, we could not transport it because the department of transport said we could not transport the wine.”
Burger said the wine industry globally was a competitive market.
“Some of these politicians believe we live in a little hut. We live in a world market. When a guy in the northern hemisphere market cannot get SA wines, they take the Australian, Chilean, New Zealand or Argentinian wine instead,” Burger said.
Burger said the wine industry should not be viewed as part of the alcohol trade industry.
“It is primarily an agricultural product.”
He said most of the shebeens which open until 2am did not sell wines.
“Why can I not sell the wine on my farm, why can it not be sold at the restaurant, why cannot grocers sell wines with their grocers' licences.”
He said he had to lay off people as they could not be employed as there was no business. These included drivers who needed to move wines.
“We do not have money to employ people. We have been giving the employees grants as a family during the lockdown.”
Burger said if government was going to take away his trading capability, there should be remedial action such as an offer to assist the farmer.
“This has not happened. There has been no support for us.”
Burger is an applicant in a court application launched by the Southern African Agri Initiative (Saai), an agricultural interest network for farmers, which wants to have the ban on the sale and consumption of wine in restaurants set aside.
“Contrary to what alcohol producers do, wine farming is not built on continuous profit- seeking.
“It is about an inheritance; the transfer of knowledge from generation to generation, the integrity of the brand, the name on the label and supporting a family and community,” Saai board chairperson Dr Theo de Jager said.
Burger said though he had 35 employees, there were about 150 dependants living on the farm.
“When we could not employ them, we kept paying the people. We cannot employ all of them any more. The contracted drivers, those who do the pruning; there is a variety of work on the farm. This is a farm with a lot of skills.”
Vinpro, which represents the wine industry, said it was already estimated that the SA wine industry — which employs about 300,000 people — would lose close to 18,000 jobs and that nearly 80 wineries and 350 wine grape producers would close their business in the next year.
This was due to the previous five-week ban on exports and nine-week ban on domestic sales. It said the new ban on domestic sales will have unintended consequences which include further job losses throughout the value chain.