Agri-Africa Consultants 38 Rhodes Ave (South) Stellenbosch
Investment growth and industry expansion
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3.2 Investment growth and industry expansion3.2.1Investment:South Africa keeps no official disaggregated data on foreign direct investment, and it is difficult to establish the extent of investment on a sub-sector level directly. So, for example, while it is possible to establish the extent of investment in a sector such as agriculture, it is almost impossible to do so for a sub-sector such as the wine industry. For this reason, indirect indicators of levels of investment are required. The basic data for such an exercise in the wine industry are provided in Table 5. These are interpreted with the help of Figures 10,11 and 12. In this regard, Figure 9 shows the main trends in producer income over the past decade. 
Figure 10: Trends in producer income, 1997-2006 These data show the influence of export expansion and, more importantly, the exchange rate, on producer income over the decade. Total nominal income almost doubled from R1 463 million in 1997 to R2 791 million in 2004 (left hand scale in Figure 10). Thereafter, producer income declined in both subsequent years. Figure 10 also shows that the share of this income from wine (as opposed to grapes, grape juice and wine for distilling purposes) reached its peak in 2002 (right hand scale) i.e. when the Rand was at its lowest. The nature of the expansion in the wine industry can also be illustrated with regard to Figure 11, which shows the number of wineries in the industry by size. It is estimated that an additional 170 (mostly small cellars) were established since 2006. What is most evident is that the substantial increase in the number of wine cellars in the industry (an increase of 279 cellars over the 10 years, or more than 2 cellars per month - indications are that more than 200 new cellars have been opened since 2006) has been almost entirely in the categories of less than 100 tonne pressed (measured on the left hand axis). The data show that 203 of the 281 new wine cellars fell within this category. A further 61 new cellars fell within the 101-500 tonne (measured on the right hand axis) category. 
Figure 11: New wine cellars in South Africa, 1997 - 2006 Nonetheless, accepting that most new cellars are small, the scale of the addition to the processing capacity of the industry is impressive. Furthermore, the smaller size of the new cellars is because most have been built on wine farms, i.e. they fall into the category of private cellars rather than producer cellars (the former wine cooperatives) and also producing wholesalers. Finally, Figure 12 shows the age composition of the vines. The figure indicates that the major investment flush in new grape-growing capacity peaked in 2000 - five years before the peak in the creation of new cellars; the lag conforms to expectations. The data confirm the well-known fact that the wine industry reached a peak expressed variously: in terms of exports, production capacity (and hence investment), and growth, all at the time that the Rand fell to its lowest value against the US$. The fact that the decline that followed was not steeper can be ascribed to the slow recovery of the Rand against the Euro and Pound Sterling, especially as the UK and the rest of Europe constitute the largest export markets for South African wine. An interesting observation on investment flows concerns internationally based investments in wine production, tourism and hospitality in the winelands. Groups such as Hess International, Lanoche, Constilation, Gallo, Cointreau, Vilafonte, to name a few are prominent in this context. 
Figure 12: The age composition of vines in South Africa, 1997-2006 3.2.2 Value adding multipliers and linkages: Error: Reference source not foundTable 514 contains the monetary values of each successive stage of the value adding process of wine making to selling for 2003. The data show that total turnover amounted to R10 675.27 million, based on a primary production base of R2 597.44 million, indicating an industry contribution that was some 4 times the initial value of the raw materials produced in the vineyards. Table 5 : Basic trends in the South African wine industry, 1997 – 2006
Source: Conningarth Economists, 2004. The macroeconomic impact of the wine industry on the Western Cape. Paarl, SAWIS Yüklə 0,61 Mb. Dostları ilə paylaş:
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