Two bottling plants in Stellenbosch have closed since 2010. Consol Glass, South Africa's biggest glass manufacturer, is preparing to cut production this year because of the sharp fall in demand for wine bottles. Its wine sector business, which accounts for a quarter of revenues, has declined by more than 20 percent over the last three years.
Rostberg, located on the Rust en Vrede wine estate which produced the wine served at former President Nelson Mandela's Nobel Peace Prize dinner, had to shut down one bottling line in 2010, and was forced to lay off 35 staff, half its workforce.
"The only way we can create more jobs is if we could bottle our wine locally," said Leo Burger, Rostberg's managing director.
The government has threatened to retaliate against the UK, the world's biggest market for imported wine, by importing bulk whisky from Britain for bottling in South Africa.
"The big winners in this trend are the bottlers who operate in the UK and the EU," said Stephen Hanival, director of agro-processing at the Department of Trade and Industry. "Jobs and capacity have been lost in developing countries like South Africa."
Bottlers and the wine industry are trying to counter the growth in bulk exports by diversifying to China, Japan and other parts of Africa, where the demand for premium wine is growing.
South Africa exported 5.5 million liters of packaged wine to China in the year to February 2013, a 24 percent increase from the previous year.
SUPERMARKET LABELS
A big factor in the shift to bulk is the growing influence of supermarkets.
Retailers in Europe have been able to squeeze pricing from their suppliers to attract customers recovering from the recession, said Stephen Rannekleiv, Rabobank's executive director of food and agribusiness research.
Some have created competing private label wine brands using foreign-sourced bulk wine.
Fraser Thompson, head of the IPL Wine subsidiary at Asda, the British arm of U.S. retailer Walmart, said countries like South Africa have had no choice but to shift to bulk to stay competitive. Asda has increased its sourcing from South Africa in recent years, partly thanks to UK bottling, he said.
"South Africa is competing on a global stage with every other wine-producing nation," he said. "Without shipping in bulk there's a danger that South Africa would lose considerable export trade to the UK and across the world."
Around a third of the wine imported by Asda is now bottled in the UK, where it set up its own bottling plant in December 2011 in Snetterton, Norfolk.
South African industry and government officials have expressed concern about what happens to the wine after it leaves the polypropylene tanks.
Hanival was particularly worried about the potential for South African wine to be blended with a lower quality wine and marketed as South African, which could have consequences for its hard-won reputation for high quality at the right price.
"In the past the UK consumer saw South African wine as moderate-to-low quality but at a very low price point," he said. "These days South African wine is seen as of moderate-to-good quality, still at a good price point ... I think we have managed to lose that label of cheap and cheerful, relatively low-quality wine."
A spokeswoman at Asda strongly denied any trans-national blending took place at Asda. Tesco and Sainsbury's, the two other big supermarket chains in Britain, did not respond to requests for comment on this story.
Bottling in South Africa includes a trackable certification seal, with various guarantees for the consumer, Rostberg said.
"Our wine certification system ensures the origin, cultivar (grape variety) and vintage only up to the harbor when it is exported in bulk, but no further," he said.
The reputational risk around the possibility of blending is uncomfortably high, some in the industry say.
"Odds are that it will adversely affect the reputation (of South African wine)," said Fridjhon. "Effectively what you're doing is turning wine into a commodity."
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