Photo: Nadezhda Chipeva
Bulgaria’s 2010 wine year will be a memorable one for all the wrong reasons, it seems, with a harvest yielding grapes of poorer quality than last year, and domestic sales and exports down.
Mass-circulation daily 24 Chassa said that the quality of this year’s grapes was significantly poorer than those of 2009, making them more appropriate for rakiya (grape brandy) than turning into wine.
For the world wine industry, the global financial crisis brought a severe blow in 2009 as tipplers reduced consumption, and current figures for Bulgaria are not encouraging.
Bulgaria’s domestic market accounts for only up to 20 per cent of production, while sales of bottled wine reportedly have plummeted by about 30 per cent, a problem compounded by the significant share of the market held by the shadow economy.
Exports down
Wine exports from Bulgaria decreased by 38.5 per cent in 2009. In recent years, the largest export markets for Bulgarian wine have been the United Kingdom, United States, Canada, Norway, Netherlands and Japan.
Plamen Mollov, head of the National Vine and Wine Chamber, said that 200 000 tons of grapes went into the shadow economy, a small amount of which was used for home production while most went into illicit production, according to 24 Chassa.
Daily Dnevnik said that sales of wine in Bulgaria had decreased between 30 and 50 per cent for different manufacturers.
Dimitar Vichev, head of a wine association representing small producers, said that the main reasons for the decline were consumers’ reduced purchasing power and a sharp increase in home production.
Vichev said that the export picture was even worse, with exports down by about 60 to 70 per cent this year.
Rositsa Kyuchoukova, owner of Villa Vinifera, said that the poor state of the market this year would reduce demand for grapes – while in any case, the harvest was bad, she said. This, in turn, would have a knock-on effect on the industry in 2011, Kyuchoukova said.
Small wine producers were complaining of unfair competition, mainly from producers using counterfeit excise stamps, Dnevnik said.
Autumn chill
For small wine producers, a further source of complaint is a new regulation that, indeed, is directed against evasion of excise duties.
From October, wine producers must have meters installed at each point of the manufacturing process to provide information in real time to the Customs Agency.
Small-scale wine producers are complaining about the high cost of installing the meters and the accompanying software, which runs into several thousand leva.
Vichev said that small-scale producers were not against the regulation, but if the state wanted such control, it should bear the cost of the equipment.
The association of small-scale wine producers said that they would appeal against a Supreme Administrative Court decision, made earlier in September, to reject an application to suspend the ordinance.
Earlier this year, producers complained that the new regulation would in fact benefit unregistered producers, who sold wine over the internet, undetected by authorities.
Assistance
There have been moves to assist Bulgaria’s wine industry.
The European programme for development of wine production in Bulgaria, worth in excess of 5.6 million euro, saw a total of 158 winery projects receiving approval and financial assistance in 2009, amounting to 21.1 million euro. The European programme, which will be operational until 2014, has a total budget of 112.6 million euro.
Wine producers in Bulgaria may apply for the programme under three criteria: restructuring and conversion of their grape vineyards, insuring the annual produce and promotion of the product in third countries. The resource, which will be allocated in 2010, is set at 21.2 million euro, and in 2011, 22.3 million.
However, it is clear that the wine industry has been troubled for some months.
According to a report by bTV in March, production overall in Bulgaria had by that stage already declined by up to 50 per cent, while thousands of bottles were lying rotting in cellars because there was no market for them and some wineries this year had no money to buy grapes because of the downturn in exports.
Mass-circulation daily 24 Chassa said that the quality of this year’s grapes was significantly poorer than those of 2009, making them more appropriate for rakiya (grape brandy) than turning into wine.
For the world wine industry, the global financial crisis brought a severe blow in 2009 as tipplers reduced consumption, and current figures for Bulgaria are not encouraging.
Bulgaria’s domestic market accounts for only up to 20 per cent of production, while sales of bottled wine reportedly have plummeted by about 30 per cent, a problem compounded by the significant share of the market held by the shadow economy.
Exports down
Wine exports from Bulgaria decreased by 38.5 per cent in 2009. In recent years, the largest export markets for Bulgarian wine have been the United Kingdom, United States, Canada, Norway, Netherlands and Japan.
Plamen Mollov, head of the National Vine and Wine Chamber, said that 200 000 tons of grapes went into the shadow economy, a small amount of which was used for home production while most went into illicit production, according to 24 Chassa.
Daily Dnevnik said that sales of wine in Bulgaria had decreased between 30 and 50 per cent for different manufacturers.
Dimitar Vichev, head of a wine association representing small producers, said that the main reasons for the decline were consumers’ reduced purchasing power and a sharp increase in home production.
Vichev said that the export picture was even worse, with exports down by about 60 to 70 per cent this year.
Rositsa Kyuchoukova, owner of Villa Vinifera, said that the poor state of the market this year would reduce demand for grapes – while in any case, the harvest was bad, she said. This, in turn, would have a knock-on effect on the industry in 2011, Kyuchoukova said.
Small wine producers were complaining of unfair competition, mainly from producers using counterfeit excise stamps, Dnevnik said.
Autumn chill
For small wine producers, a further source of complaint is a new regulation that, indeed, is directed against evasion of excise duties.
From October, wine producers must have meters installed at each point of the manufacturing process to provide information in real time to the Customs Agency.
Small-scale wine producers are complaining about the high cost of installing the meters and the accompanying software, which runs into several thousand leva.
Vichev said that small-scale producers were not against the regulation, but if the state wanted such control, it should bear the cost of the equipment.
The association of small-scale wine producers said that they would appeal against a Supreme Administrative Court decision, made earlier in September, to reject an application to suspend the ordinance.
Earlier this year, producers complained that the new regulation would in fact benefit unregistered producers, who sold wine over the internet, undetected by authorities.
Assistance
There have been moves to assist Bulgaria’s wine industry.
The European programme for development of wine production in Bulgaria, worth in excess of 5.6 million euro, saw a total of 158 winery projects receiving approval and financial assistance in 2009, amounting to 21.1 million euro. The European programme, which will be operational until 2014, has a total budget of 112.6 million euro.
Wine producers in Bulgaria may apply for the programme under three criteria: restructuring and conversion of their grape vineyards, insuring the annual produce and promotion of the product in third countries. The resource, which will be allocated in 2010, is set at 21.2 million euro, and in 2011, 22.3 million.
However, it is clear that the wine industry has been troubled for some months.
According to a report by bTV in March, production overall in Bulgaria had by that stage already declined by up to 50 per cent, while thousands of bottles were lying rotting in cellars because there was no market for them and some wineries this year had no money to buy grapes because of the downturn in exports.
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