Since 1980, the successful family-owned Van Loveren enterprise started playing a pioneering role in the local wine industry. From 1998 to 2013 its turnover increased by 2 300%. Although this growth has flattened out over the past three years, Van Loveren is now gearing itself up for another S-curve.
Located against a backdrop of majestic mountains and with Cape Dutch gables and verdant valleys completing the picture, the local wine industry is often romanticised. This bodes well for wine tourism, but it’s not a true reflection of the production realities that wine producers face at grass-roots level.
Wine farmers are currently in a process of diversification and consolidation. This can be ascribed to a more attractive net farming income per hectare in other agricultural sectors, such as citrus and some deciduous and stone fruit types. Moreover, the current drought exacerbates the situation for some wine producers.
“Within two years South Africa could experience a wine shortage – for the first time in many years,” says Phillip Retief, CEO of Van Loveren Family Vineyards near Robertson. “Should we need to import wine, prices of local wines will also show an increase, which will be a positive situation for producers.”
After a period of exponential growth since the early 1990's, 2006 ironically ushered in a new period of old vineyards being removed at a greater rate than new ones being planted. This trend is expected to continue over the next five years. Wine production nevertheless reached record highs between 2010 and 2014 thanks to improved production techniques and favourable climatic conditions during the said period.
According to Retief, who is also vice chairman of the producers’ organisation Vinpro, the wine industry is currently experiencing the bottom of an economic cycle.
Asked about Van Loveren’s own successes since 1980 (see box), Retief points out that it all starts with being adaptable, sustainable, profitable, innovative and creating value for stakeholders. In order to farm profitably, Van Loveren tries to achieve high yields of good quality wine grapes. The average yield is 17t/ha.
This story is from the 26 January 2017 edition of Finweek English.
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This story is from the 26 January 2017 edition of Finweek English.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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