Branimir Botev, Chairperson of the Managing Board of the Association of Producers, Importers and Traders of Spirit Drinks, in an interview for Focus News Agency.
Focus: What is the level of demand of wines and spirits, and which of them is more preferred by consumers?
Branimir Botev: The trend over the last few years has seen people lean more towards wines. The wine culture is winning customers in many countries, including countries that are not traditional wine consumers. Take a look at UK, for instance, which is traditionally considered as a higher-proof spirits market, but where one of the highest levels of consumption of wine is registered and it is a consumption of specially selected high-quality wines. The situation in the Scandinavian countries is similar. There is a real growth in the trend of consumption of wines and, of course, a clearer trend for consumption of more high-quality wines. The stress is mainly on dry white wines.
Focus: Does this happen at the expense of higher-proof spirits?
Branimir Botev: No. Currently the higher consumption of wines is a separate event. Countries, which are traditionally consuming more higher-proof spirits have also started consuming more wine.
Focus: Is Bulgaria also a part of this trend?
Branimir Botev: Yes, it is enough to just look and see how many wine stores have been opened over the last few years. There is also a surge in the number of promotions of wines, as well as a trend for establishing new wineries. This means that the stress has been displaced from quantity to quality, and to diversity. The focus is definitely placed on specific demand, connected with different foods, different tastes, different regions, which have become popular. People no longer choose quantity, but rather – quality.
Focus: The higher quality is also connected to higher prices. In the context of the crisis, how are the prices going to change?
Branimir Botev:There is an increase of the price of energy sources – the fuels needed for the land and grape processing, as well as of the plant protection products. As all these prices have increased, it is logical to face a price hike of the wines, as well. The price of wine will increase due to the hike of the basic production components price – labour force, price of fuels, price of plant protection products, and etc.
Focus: The price hike of energy sources and of fuels has already happened. Did this have any effect on the prices of wines, or is it yet to reflect on them?
Branimir Botev: The price increase is yet to come, as most of the producers in Bulgaria have wine from previous years, which will have to be realised at the market. The price hike, however, is a global trend. It is also connected to the ban on planting new vineyards in Europe until 2021, having in mind that Europe is the biggest producer of higher-proof spirits, including spirits from grapes, and of wine.
Focus: Do you know what part of the market is occupied by unregulated production?
Branimir Botev: There is no real mechanism to calculate the exact percentage, as wine has zero excise and this it is not affect the state revenues. We make rough calculations each year, depending on the grape crop – how much enters licenced producers, and how much is left for home-made production. Thus we can make an estimation of how much home-made wine or rakia Bulgarians consume.
According to the Institute of Viticulture and Oenology in Pleven, the crop of wine grapes in 2011 was around 244,000 tonnes, while this year the expected crop went down by around 30% to between 160,000 and 165,000 tonnes.
Focus: Do you have any data of how many people are employed in the wine producing sector in Bulgaria?
Branimir Botev: There are more than 260 companies, which have licences for production of wine, and some of them also have licences for production of higher-proof spirits. According to data from around a year ago, there were around 36,000 people working in the production and distribution sphere. One must bear in mind that this industry gives employment to a large part of agriculture land owners – owners of vines. Along the chain there are also a lot of people working in the sales, marketing, and realisation of the production, and even restaurant and sommelier spheres. One could say that a vineyard, which processes around 500 tonnes of grapes, should provide employment, both long-term and part-time, to around 100-120 people. Parts of the end product realised on the market as wine, in fact returns to the owners of land and vines, sometimes.