Nigeria and Angola increasingly important markets for South African wine
Wines of South Africa (WOSA) is an export marketing council with the mission of growing the presence of South African wine brands in the international market. With over 500 exporters, WOSA is a non-profit organisation that is independent of government, but is funded by a levy per litre on all bottled wines exported.
Currently, WOSA is developing its presence in Africa. In an interview with Matome Mbatha, WOSA’s market manager for the Americas and Africa, How we made it in Africa found out a bit more about the continent’s wine industry.
In Africa, which markets are targeted?
Primarily, at this stage, we are targeting one of the key markets that have shown growth, which is the Angolan market. It’s our second largest export market, after Nigeria. We have also seen growth – and steady growth – in the areas of the East African markets. That is your Kenya, Zambia, Uganda, and we are actually seeing some exports into markets such as Ethiopia as well.
How would you describe the competition in Africa’s wine market?
Indeed there is a strong presence in the different countries from the French, Italian and Portuguese wines. However, the presence of these wines is at a very entry level. So for South Africa, opportunities are within the value adding in terms of the premium wine offering. But there is competition from other wine producing regions.
Is WOSA seeing growth in its exports to other African countries?
In Nigeria particularly we have seen plus-minus 10-15% growth year on year. Kenya specifically has also grown by up to 45% from 2011 to 2012.
And basically maybe I should give you a background of Nigeria itself. It’s a market of over, safely, 20 million litres. And WOSA is taking a share of about 5% of that.
How does the demand for wine compare to that of other alcoholic beverages in Africa?
You will find that there is more favour of beer as a cool drink. And in that sense, with the change of lifestyle, people migrating from low-level lives to medium to up to high-end lifestyles, there is a trend of diversifying from their normal drinks, which is beer and whisky, to now wine. African people travel a lot and upon return back home they want to experience the same life and offering they had in the places they travelled to. In that way there is dramatic growth, but above all the quality that South African wine brings to a large extent contributes to the interest in wanting to get more quality onto their table. So that in a nutshell means there are future opportunities for us to get into the market and showcase what we produce.
Who are the main distributors and retailers of wine in the rest of Africa?
It is a mixture of all because if you look at the markets in Africa it’s in two forms. There is what is called the informal trade where generally wine is sold in an open market which is very huge, and then there is also a huge development in terms of trade with the sophistication of five star hotels and high class restaurants. So opportunities are created from both sides. But overall it is actually the cooperation and enthusiasm that we have found from the distributors that they also want to share and offer diversity in their products, above all quality addition and value addition.