The South African wine trade has been left reeling by the severity of the government’s response to the Covid-19 pandemic this year. Domestic sales were prohibited for several months, and wineries were preventing from exporting for a worrying five-week period.
The industry, which employs around 290,000 people, has been brought to its knees by the lockdowns and sales bans. Drinks International caught up with Bruce Jack - who founded Flagstone and served as chief winemaker at Accolade Wines before creating his eponymous brand - to hear an inside perspective on the situation.
How have you responded to the extreme challenges that the South African wine industry has faced this year? And what short-term impacts will you face this year as a result of the coronavirus lockdown, the domestic sales ban and the export ban? What might the long-term ramifications be? How confident do you feel in the future health of the industry?
The long months of the various bans felt like a psychological assault course. Mentally most of us were under-prepared for the financial destruction that took place as a direct result of the bans. Sales are still restricted.
But much worse was discovering how we are perceived by our government.
The reality is that there are powerful people at the epicentre of South African government who only see the toxic relationship between alcohol and the populace. There is also a much-vocalised belief that this is a direct legacy of apartheid and colonialism. This underpins much of the anti-alcohol rhetoric.
Layer upon this core belief a Marxist-Paternalistic political philosophy inculcated in many key ANC members of parliament during the armed struggle. Throw in totalitarian-like powers, inexperience and personal agendas, and it is no wonder incomprehensible laws were hastily enacted. But this needs context.
Picture a disillusioned drunk sitting on an upturned beer crate in the dark, uncomfortably hot, smoky recess of a shebeen (township drinking hole). He is inevitably a he, and has just spent all his meagre wages on beer. At home his ignored family go hungry – and things are about to get worse.
This is the image that first comes to mind when you mention the alcohol industry to many politicians in central government. While it is not a comprehensive truth, it is simultaneously also not a fragment of the imagination – it is a real and relevant problem in South Africa. The resultant, dislocated, torn fabric of society – all true. The ensuing spiral into poverty, injury to self-esteem, joblessness, violence, hospital trauma – all a widespread reality.
This is one of the main reasons why the economic argument to lift the ban fell on deaf ears. Firstly, the shutdown was about saving lives and freeing up hospital capacity. The initial economic arguments never progressed past the “what value does one place on a life?” question, posed by the advising health specialists – as seen in most countries. Secondly, and more importantly within the SA context, the alcohol industry is already blamed for destroying more wealth and wealth-creation opportunities within the larger population, than in creating jobs, or indeed wealth for the country through excise duties and taxation.
And big industry beer (no longer even South African-owned we are reminded) is blamed as the evil catalyst here, not wine – still sometimes regarded in some circles as a strange euro-centric pastime the white minority dabble in. This is of course wrong, but wine was recently described on a left-wing political social media post as being ‘white nonsense’ and was likened to the ‘white’ proclivity of owning a small dog with an irritating squeaky bark. I found that very funny at the time, but it does expose a perception worth noting when contextualising the alcohol bans. It was never about destroying the wine industry. Rather it was the result of a deeply held, strong belief about the origin of many South African societal ills.
It turns out, the damage to the wine industry was simply collateral damage caused by a focused attack on big industry beer. It is true that the State of Disaster Declaration and our President’s leadership style gave strong, key individuals within his cabinet enormous power. They took the rare opportunity to ‘fix’ the widespread noxious abuse of beer. In so doing, I believe they were generally trying to do the right thing. Alcohol-related hospital trauma admittance dropped, and although this cannot fully be attributed to the alcohol ban, it did play a role. A quick fix was needed, and it was easy to blame beer and close the entire industry down.
The alcohol industry tried to paint a more encompassing picture. We argued the economic logic, and while it had some effect to reinstate exports, it was dismissed as a factor in the local context.
We argued that the widespread destruction of wealth and the dismantling of the economy by the ANC had already led to the hopelessness and misery we see. And it is this predicament which is the cause of alcohol abuse – not the other way around. Similarly banning alcohol to stop related trauma, we pointed out, is like banning kitchen knives as a way to stop stabbings. It is also common knowledge that the now endemic, deep corruption had already, prior to Covid and lockdown, destroyed most societal safety nets affecting the poor – including hospital capacity and social welfare efficacy. There were many more similarly salient points put forward.
All these ‘contributing factor’ arguments, if they ever got to the inner circle of the Command Council, were either ignored or swept aside. If they did reach the inner circle it probably required too much self-analysis at a time when action and authoritarian posturing were a welcome distraction to those criticised for failing the country and the Mandela dream.
The easy way out was to blame beer. And I believe it will happen again when the 2nd wave of infections and hospitalisations becomes problematic. It was previously touted as the most effective tool for flattening the curve. It is probably the only tool, but it’s like using a sledgehammer to instal a little brass screw. This then is the reality, and we must live with it.
In this context, faced with such entrenched and resolute anti-alcohol sentiments, the utter hopelessness of our predicament was suddenly clear. The South African wine industry abruptly and collectively realised the true extent of our insignificance. We had long been banished into the political wilderness – we just didn’t realise it. We had been operating in a bubble of self-deception – and without any relationship capital with government, when the ban was imposed, connection and discourse were impossible to establish.
Whatever we thought we were doing right in terms of community upliftment and employment and whatever we believed we were contributing to this country in terms of economic contribution; we now know is, at best, antagonistically disregarded.
It’s a very strange feeling, knowing for certain from the experienced actions of government that your life’s work is irrelevant in the eyes of the people who control your destiny. It is no surprise that I am seeing extreme cases of behaviour around me in the wine industry – people either have their heads in the sand, ignoring this reality, or they are poleaxed by a sort of dark, immobilising depression. The long-term ramifications can be extrapolated further by anyone with half a brain.
I have reacted to this nightmare by pouring my energy into three main areas of action. Firstly, our own business is fortunately mostly export, so financially we are surviving in the short term and I have doubled my efforts to entrench the export business we do enjoy by trying to over-deliver on all levels. Our UK retail partners in particular have been a source of inspirational comfort in the darkest hour and the UK trade can collectively take a bow. Thank you.
Secondly, I have thrown myself into social upliftment projects we had already started, including the HeadStart Trust, our NPO that is focused on both food relief efforts and youth music education. I was invited by my friend Mike Ratcliffe to be part of an industry thinktank looking at how we re-imagine the industry now that we know where we stand. That is both a challenging and fascinating endeavour but represents a small light at the end of the long-term tunnel.
Thirdly, the medium-term prognosis requires intense self-reflection. I have emersed myself in research and intensive innovation activity. The research requires reading widely, both similar historical socio-political situations and scenario planning insights. It means I have been talking to as many people with insight as possible. My learnings are still fermenting with no firm conclusions.
What would be your message to international wine buyers about the ways in which they can support the South African trade right now?
While I am, like many in the industry, very grateful for the focus and the support we have received from the UK trade in particular, I do not believe we should be treated differently – that makes no sense and isn’t practical. Buyers should do what they are paid to do, which is to buy the best wine at the best price.
Ultimately, the South African wine industry needs to support itself if we have any chance of survival.
South Africa is arguably making the best wines in its history, and some of the best wines in the world, but it does not seem to command the same sort of prices as other countries in international markets. What can be done to boost the perception of South African wine? What can producers do while travelling is difficult and Cape Wine has been postponed?
Firstly, I don’t think we are making some of the best wines in the world at all price points. Between £10 and £20 and above £40 there may well be an argument for such a statement about quality. But below £8 (where the majority of wine is sold with some profitability) I would disagree, especially regarding reds. As an industry we could collectively be a lot more innovative and quite frankly, make better wine at these fighting price points.
There seems to be a lack of pride in some productions, a lack of attention to detail in blending and too many short cuts in the growing and crafting. Thankfully, we have got a lot better at bottling. Besides some examples of lacklustre winemaking, you can also see it in some of the analysis compared to big brands from Australia or Chile. This indicates to me that the required pride and ambition to be the best may take second place to deal making and cost-cutting. We should generally be doing better as a country below £8.
The negative and incorrect quality perception problem at super premium level is not new, nor is it just a wine thing. In fact, it actually isn’t about quality either. It is really a perception about sophistication, which is linked to a euro-centric, brainwashed idea about civilisation and how that impacts on intrinsics like quality.
It is the same problem faced by countries like Turkey and Iran. For example, historically Greece was a pimple on the backside of the Ottoman Rhino, but we are still spun a bizarre, pumped-up, euro-centric slop that puts Greece at the centre of civilisation and influence. Don’t get me started on the uneducated crap Hollywood is responsible for. Africa suffers from the same problem, only 100 times worse.
All African endeavours, wine included, carry the stigma of being African. It is just something we have to live with as Africans. This isn’t a perception we have the power to change quickly or to any great extent. If it was, world influencers like Nelson Mandela, Mark Shuttleworth, Elon Musk, etc… would have already done so.
I am not defeatist – it is rather both a practical and proactive position. I also don’t have the energy or interest to waste on complaining about it. Rather I am totally opposed to this notion that the only way to change the status quo is by whining like bullied pre-schoolers about the unfairness of life. The stigma of Africa is what it is, and life isn’t meant to be fair.
As South African winemakers (of whatever hue) we just need get on with it. The quality perception of our wines may or may not always be accurate. That no longer bothers me. We need to be more nimble, more intelligent, more ambitious and work harder than everyone else – that is our reality. We need to learn that therein lies its own spiritual reward.
Financially, our concerns as an industry have bigger issues to worry through than the international perception of our quality.
Practically, the goals are simple and the same as any wine industry around the world – increase margin, selling price and the volume of wines achieving these. One proven way is to aggressively drive the direct to consumer retail business model, and in that way tell our stories and sell our wines directly to those we can interest.
However, this carries a risk, because our traditional volume channels – primarily the large UK grocers will find this problematic. The solution therefore is to drive DTC for above £10 price points and just make better wine at the everyday price points. In time the biggest channels, currently the big grocers, will buy better and better South African wine – if it is made available to them.
If buyers can play a role, it is only in doing their job, and I am comfortable most of them do that very well already.
