South African Wine Producers See Crop Cut by Flood, Fungus

By  Alastair Reed and Brian Latham

Feb. 23 (Bloomberg) -- South Africa’s wine producers, with a history dating from 1655 and the Dutch East India Co., expect flooding, fungus and disease to cut the grape crop this season.

“Estimates are that at least 36,000 tons of grapes from the initial anticipated wine grape harvest were destroyed by floods and showers -- the figure may yet be higher,” said South African Wine Information Systems, representing all the country’s wine producers. “Grapes in many other blocks have started to rot and outbreaks of fungal disease prevail.”

Water has damaged vines in the Orange River region, with an “enormous cost” for local producers, while other areas remain flooded, resulting in a “total crop loss,” Sawis said today in an e-mailed statement. Overall production may drop 0.3 percent from 2010 to about 1.26 million metric tons of grapes, it said.

South Africa, the seventh-largest wine maker, mainly grows white grapes, including Chenin blanc, Chardonnay and Sauvignon blanc, while red varieties include Pinotage, a hybrid developed in the country. The industry is focusing on “non-traditional markets” such as Canada and China as sales decline to the U.K., its main market, the Wines of South Africa export group says.

Based on the latest production forecast, South Africa will this season produce 969.3 million liters (256 million gallons) of wine and related products such as juice, concentrate, wine for brandy and distilling wine, Sawis said. Stocks held by producers and private cellars will fall to 314.1 million liters by Dec. 31, from 338.3 million liters a year earlier, it said.

First Vines

South Africa’s first vines were planted in 1655 near Cape Town, where Dutch settlers set up a station to supply ships plying the spice routes. The Cape’s first famous wine was Constantia, a sweet fortified muscat that was shipped to Europe, where Louis XVI and Napoleon Bonaparte became fans.

Wine routes around the university town of Stellenbosch take tourists past more than 140 producers, including family owned Meerlust and Vergelegen, owned by London-based Anglo American Plc, the world’s second-largest mining company.

Italy is the world’s biggest wine producer.