Georgia on edge
Julia Harding MW was in Georgia this past weekend when the nationwide protests that began after Georgia’s most recent election intensified after the government suspended accession talks with the European Union.
To make a very long and complicated story short, Georgia gained independence from the Soviet Union in 1991. Since then, they have pursued EU membership – the goal of EU membership is written into their constitution. Last year, the country gained EU candidate status. This year, at the end of October, the country held elections. The Georgian Dream party – an anti-Western pro-Russia party founded by Georgia’s wealthiest individual, Bidzina Ivanishvili, who made his fortune in Russia – won the election. The European Parliament rejected the election results because of irregularities. On 28 November, Prime Minister Irakli Kobakhidze said that Georgia would suspend EU accession talks for the next four years. According to US nonprofit National Democratic Institute, 81% of Georgians support EU integration. So, the fact that the protests that began after the election have intensified is not surprising.
But, this being the wine news, what does this mean for producers or lovers of Georgian wine?
When Russia banned Georgian wine imports on spurious sanitary grounds, from 2006 to 2013, many producers worked hard to improve the quality of their wines and started to export to the EU, the UK and the US. Gaining EU candidacy status in 2023 helped streamline trade processes and allowed producers to continue to build their exports. Georgia recorded its highest export numbers to the UK ever in the first six months of 2024. This is a significant development because 66% of Georgia's wine exports currently go to Russia, and at below-average prices. EU, UK and US export markets represent the opportunity for smaller producers to focus on quality and sell at higher prices than the industrial production that serves Russia. If Georgia does not continue its path to EU accession, it is likely it will become much harder for Georgian producers to export, and consumers will not see the range that they currently enjoy.
According to Tina Kezeli, head of the Georgian Wine Association, ‘This is about a true popular uprising and brutal violation of human rights. This is about the country that has created the wine culture and shared it with the world being repressed for its love of freedom. This is about people in this part of the world desperately trying to protect European values and it is extremely important for the rest of the world to understand what's going on. It is also important to say that all efforts I and my colleagues have put into putting Georgia on the world wine map in the last 30 years could be lost forever.’
New Mâconnais premiers crus
On 29 November Vins de Bourgogne announced that the INAO had approved four new premier crus in the Mâconnais – all exclusively planted to Chardonnay: Les Mûres in the village of Pouilly-Loché, and Les Longeays, Les Pétaux and Les Quarts in the village of Pouilly-Vinzelles. Labelling as premier cru for these sites requires hand-harvesting, limiting yields to 58 hl/ha, and ageing wines until 1 July following the harvest. Also, for the first time in Burgundy, labelling with these premiers crus requires that a producer farm without herbicides.
There are now 26 premier cru vineyards in the Mâconnais. There are not yet any grands crus. [See The World Atlas of Wine map of the Mâconnais here for further detail.] You can find a number of tasting notes from producers who make wines from the newly minted premiers crus in our database – many of these are stunningly good value for Burgundy and score on par with big hitters from the Côte d’Or.
Global wine production in decline
On 29 November the OIV published estimates on global wine production in 2024. Their estimates show that between 227 and 235 million hl of wine were produced. This is a 2% decline from 2023 and a 13% decline from the 10-year average. If production numbers are confirmed to be within this range, this will be the smallest global wine production since 1961. In the last eight years we have experienced the three smallest vintages in the last 63 years. In all cases the reason was extreme or atypical meteorological events such as early frosts, heavy rainfall and prolonged drought which have been exacerbated by economic and market circumstances.
South Africa’s proposed tax hikes
On 13 November the government of South Africa published a 47-page policy review on the taxation of alcoholic beverages and recommendations for restructuring excise taxes. The document states that this is to align with the World Health Organization’s global strategy to reduce the harmful use of alcohol. It then proposes three possible scenarios to increase excise taxes:
- a flat rate increase from 11% to 16% of current average retail price
- a banded increase in line with inflation plus 4%
- a banded approach based on alcohol percentage
This last proposal lays out a plan where wine between 0.5% and 4.5% abv would remain at the current tax rate; 4.5–9% abv would see a 40% tax increase, and wines at 9–16.5% abv would see an 80% increase.
On 27 November, South Africa Wine, the national body representing the country’s wine-grape producers and industry stakeholders, issued a statement condemning the planned tax increases and pointing out that increases would destabilise an already struggling industry and could lead to an increase in the illicit alcohol trade – which already accounts for more than 22% of all alcohol in South Africa, and which undermines legal, tax-paying businesses. CEO Rico Basson stated, ‘Instead of penalising compliant producers, the government should focus on combating illicit trade and strengthening law enforcement.’
If you are in South Africa and drink wine, make wine, import wine or have family involved in the wine industry I highly encourage you to email your thoughts on the proposal to 2024Alcoholreview@treasury.gov.za. The government is reviewing public comments until 14 February.
For what it’s worth, my personal opinion is that inflation plus 4% is fair. But an 80% increase which covers virtually all wine that is not de-alcoholised would eviscerate the wine industry. According to South Africa Wine, 43% of the industry currently operates at a loss, 3% breaks even, 46% is low profit, and only 8% is considered profitable.
That’s all for this episode of the wine news. If you enjoy this newscast and would like to see it continue, please subscribe to JancisRobinson.com. And if you have breaking news in your area, please email news@jancisrobinson.com.
Image at top by Vins de Bourgogne.
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