Boxed wine in SA outsold bottles for the first time in 2020 – and canned wine is now also a thing
- Wines sales in South Africa fell by 20% last year amid restrictions on alcohol sales during the pandemic.
- But so-called "bag in box" wine sales were more resilient than bottled wine, and outsold the latter for the first time ever.
- South Africans also bought more than 69,000 litres of canned wine last year.
- For more articles, go to www.BusinessInsider.co.za.
Due to long bans on alcohol sales during the pandemic, South Africa wine sales in the local market shrank by a fifth last year – but so-called “bag in box” wines proved more resilient than bottled wine.
New data from the industry body SA Wine Industry Information and Systems (Sawis) shows total sales of still wine came to only 285 million litres last year – compared to 356 million litres in 2019. Sparkling wine sales were also down 20%, to below 8 million litres.
But while sales of wine in glass bottles dropped 24% to 121.5 million litres sold, boxed wine sales only fell 10% to 126.3 million.
This is the first time that boxed wine outsold bottled in South Africa, Sawis confirmed.
“Our thinking is that it has to do with Covd-19 lockdown and bans; consumers buying bag-in-box and not bottles,” says Charles Whitehead, manager of information services at Sawis.
In the pandemic, more people drank at home as alcohol sales in restaurants and pubs were banned for months, which strengthened the demand for boxed wine. Consumers, hit by retrenchments and economic hardship, were also more price conscious, opting for the traditionally cheaper boxed products.
Philip Retief, CEO of Van Loveren Vineyards, says Covid has strengthened the trend towards boxed wine, which has been growing over the past five years, while demand for wine in glass bottles has stagnated.
Boxed wine is seen as offering more value, and being more convenient, says Retief. And because many quality wines are now also available in boxes, younger wine-drinkers often don’t have the negative perceptions that older generations have about drinking wine from a box.
Last year, Woolworths launched a range of premium wines – including from brands like Kleine Zalze, Pierre Jourdan, Beyerskloof, and Diemersdal – in three-litre boxes.
In other countries, like Sweden, by far the majority of wine is now sold in boxes, says Retief.
After initially resisting (the profit margins on boxed wines are lower than glass, and demand is more price sensitive) Van Loveren launched a three-litre option a couple of years ago, followed by a five-litre product.
Wine in cans
In 2020, for the first time, Sawis recorded canned wine sales in South Africa, which reached 69,100 litres last year.
While still only in its infancy here, canned wine sales have been growing fast in other markets like the US and Australia. Particularly popular among younger drinkers, these wines are often cheaper than bottled version, and more economical because you don’t have to buy a whole bottle if you only want one or two servings.
READ | South Africans are starting to drink wine from cans - and some of the country's top winemakers are now making the move
Canned wine is also more efficient to pack and transport than bottles, and far more recyclable. South Africa recycles 43% of glass packaging, compared to 70% of used beverage cans, according to Recycling International.
Wine sold in so-called tetra packs fell by more than 30% last year to below 9 million litres, while wines sold in foil bags remained flat.
The article has been updated to reflect the corrected rate of glass recycling.
(Compiled by Helena Wasserman)
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