After ending 2024 on a high, South Africa’s wine industry has entered the new year with a bit of a hangover. The first quarter of 2025 has been marked by flat sales, cautious consumers, and a market feeling the pinch.
“It’s the impact of low consumer confidence, unfolding right before our eyes,” says Oelof Weideman, Head of Insights & Business Advisory. And the data backs him up. South Africa’s Consumer Confidence Index dropped from -6 at the end of 2024 to a worrying -20 in the first few months of 2025 – the lowest it’s been in years.
“That number’s more than just a stat,” Weideman explains. “It tells us how people are really feeling. Right now, South Africans are anxious, and when confidence is low, wallets close.”
Promising signals, but little relief
It’s not all doom and gloom on the macroeconomic front. The Consumer Price Index has eased to 2.7%, food inflation is sitting at a modest 2.5%, and GDP is creeping up at 0.6%. Encouraging signs, sure – but the average household hasn’t felt the benefit yet. Job prospects are still tight, and wine, it seems, is being left on the shelf.
Wine sales have dropped by 2.6% in value compared to the same time last year. The dip is even steeper when it comes to volume, with 750ml still wines down 4.9%. “In fact, wine was the worst-performing liquor category in Q1,” says Weideman.
The price-savvy consumer
Interestingly, shopping frequency is up – people are now popping into stores around 4.8 times a month (up from 4.4). But more trips don’t mean bigger baskets. “It usually signals price sensitivity,” says Weideman. “Consumers are becoming more deliberate, hunting for deals and better value.”
That’s why larger formats like 1-litre bottles are holding steady, and wines under R50 are growing in popularity. On the flip side, bag-in-box formats – which once dominated for their volume and value – are taking a hit. Price hikes and fewer promotions have pushed some shoppers out of the category altogether.
Mind the price point
One of wine’s biggest challenges? Price thresholds. “The moment a bottle tips over R100, it can stall at shelf,” Weideman notes. Wines under R80 – once the core of the market – have shrunk by 6.4%. The only bracket showing slight growth is the R100–R200 tier, up just 1.2%.
Chenin Blanc and Chardonnay are eking out small gains (+1.8% and +0.9%), but the rest of the varietal list reads like a roll call of decline. Rosé, Shiraz, Sauvignon Blanc, white blends, Merlot, Cabernet, Pinotage – they’re all trending down. Even red blends, a go-to for years, have dipped below 10 million litres for the first time in recent memory.
Choice overload in retail
There’s pressure on retailers, too. While the number of available wine products keeps growing, only 5.5% of SKUs account for 80% of all wine sales. “When overwhelmed, shoppers tend to default to the familiar,” says Weideman. It’s a clear signal to retailers to trim the fat and focus on what really moves.
Smaller, alternative formats – like single-serve bottles and canned sparkling wines – are doing well. But their rise could be thanks to factors like convenience, sweetness, or higher alcohol content, rather than a genuine connection to wine culture. “They may be pulling from the flavoured alcohol space more than traditional wine,” Weideman suggests.
A silver lining
Here’s the good news: premiumisation isn’t going anywhere. While people might be dining out less, when they do, they’re choosing quality over quantity. “There’s a shift toward more intentional, memorable wine experiences,” Weideman says. A splurge on a special bottle for a meaningful occasion is one way consumers are still engaging with the category.
The road ahead
For South Africa’s wine industry, 2025 has started on uncertain footing. But there’s still room to adapt—by being smart about price, sharper with messaging, and focused on meeting consumers where they are.
“The start of the year has been sobering,” Weideman reflects. “But if there’s one thing our wine industry knows how to do, it’s weather a storm.”
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