Wine industry body Vinpro is in deliberations with the wine industry and the government to find the best possible solutions to address the problems associated with the unscrupulously cheap wine infamously known as “rooiproppie” (red cap) or “papsak”.
The wine, sold in cheap, unbranded packaging for less than R20 per litre, is seen as a contributor to high levels of alcohol misuse in poorer communities.
Their discussions with government and the wine industry follows the announcement by the Western Cape premier Alan Winde on 22 October 2020 of the intention to implement a minimum unit pricing (MUP) on alcohol to curb binge drinking.
Wanda Augustyn, manager of media & communications of the wine industry body Vinpro, indicated that the announcement by Winde has once again placed the spotlight on product lines such as wine in plastic or the so called rooiproppie. But the industry is concerned that an introduction of MUP will serve to fuel the illicit trade that operates outside the regulatory framework and could lead to increased criminal activity.
Price increases need support from law enforcement
“As of yet there is no clear national or provincial policy framework for minimum unit pricing and the wine industry is in consultation and discussions with industry and government in this regard, because without a clear policy framework, we can only draw on international examples,” said Augustyn.
She indicated that almost all international studies confirm that any successes are dependent on the enforcement of the legislation and without proper enforcement, no clear evidence exist that MUP will decrease alcohol sales in the hope to reduce total consumption.
In South Africa the presence of a large informal market limits MUP from being effective because consumers can bypass price controls rather than reduce total consumption, the organisation believes.
“To give context on wine in plastic, this segment has declined from 60 million to 31 million litres in the past three years (5% of the total wine production), a trend that we believe will continue.”
A factor in this decline in the cheap wine category seems to be the upsurge in non-wine alternatives.
“It’s important to note that sales of Ales, a sugar fermented product, amounted to more than 120 million litres per annum. This product looks like wine and is marketed alongside wine, inter alia in plastic containers, but it is not wine,” said Augustyn.
‘Our research is showing us that if you raise the price of alcohol then it reduces the poorest among the heavy drinkers’ consumption.’
Dr Charles Parry, director of the alcohol, tobacco and other drugs research unit at the South African Medical Research Council said that South Africa has a heavy drinking problem, and we need to look at the drivers thereof.
“The rooiproppie or the red cap is a contributor to heavy drinking in the country. When we look at our heavy drinking problem in the country, we need to look at what fuels it,” he says
Parry revealed that the factors that fuel heavy drinking include container sizes, easy availability, poor regulation of sales, trading hours and cheap prices of alcohol.
He explained that the rooiproppie fits this description perfectly because not only is it packaged in plastic containers often “filled with wine or sugar fermented beverages” it is also extremely low-priced.
“The average price of rooiproppie is about R20 a litre and it can be sold even for R10 a litre. So, it is the cheapest in the market,” he says.
Parry disclosed that the South African Medical Research Council is currently doing research on the minimum unit pricing of alcohol to reduce the high drinking statistics in South Africa.
“Our research is showing us that if you raise the price of alcohol then it reduces the poorest among the heavy drinkers’ consumption,” he says. He indicates that many countries such as Scotland and Wales are also looking into setting a minimum price for selling alcohol.”
Parry indicated that their research also revealed that implementing MUP will generate more value added tax for the government even though they will receive less excise. There will also be resulting health benefits.
“We have actually done modelling to see how much HIV and violence you get for different price increases, so it is quite exciting work that is going out soon,” he reveals.