24 10-12 presentation vca marco tiggelman

CBI - Ministry of Foreign Affairs

The Value Chain Analysis

10-04-20232

Objective

The Validation of the CBI’s Export Value Chain Analysis of Bolivian Wines:

“ What are the Key Bottlenecks preventing Exports?” Presentation of contents

Feedback


10-04-20233 CBI - Ministry of Foreign Affairs

Contents

•History wine production •Tourism•Regions•Grapes•Exports•Quality•Corporate Social Responsibility (CSR)•Supply Chain•Stakeholders•Bottlenecks summary•Value Chain Map•Market opportunities

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History

• XV century start of viticulture with Spanish and Portugese traders

• Cinti region in 1584, registered in Tarija in 1606, followed by 1618 in Samaipata

• Through mining ‘Singani’ became popular against low winter temperatures

• Priest Alejandro Corrado wine exported to Tucuman and Potosi in 1755

• XXth century grape production > 1000ha

• Increasing professionalism in production and distribution now reaching estimated 3000ha

• Sector provides 5000 direct and 11000 indirect jobs


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Tourism


• Wine route started in Tarija 10 years ago

• New project led by FAUTAPO include quality certification system for wine route, increasing tourism

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Regions

• in 2013 estimated increase to 2700ha (90% area in Tarija and Chuquisaca)

• 50 wineries active in Tarija, of which 33 registration SENASAG (health) and SIN (tax)

• 2200 small family growers in Tarija and Chuquisaca (0,5 - 1ha)

• 260 small size growers (1 - 5ha)

• 100 growers (>5ha)


Bottleneck – Focus on local consumption of grapes and production of singani and artisanal

Bottleneck - small economies of scale resulting in relative high cost prices

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Grapes Most planted varieties are

Moscatel, Cabernet Sauvignon and Tannat. Moscatel is mainly used as base for Singani

International quality varieties as Cabernet Sauvignon, Chardonnay, Sauvignon Blanc, Merlot, Syrah, Malbec and Riesling account for only 22% of total grapes. This includes some local yet interesting varieties such as Tannat (Uruguay) and Torrontes (Argentina)


Type of wine Grape Variety Quintal (qq) Percentage (%)

Table white wine Moscatel de Alejandria 28,960 28.7

Table red wine Black criolla grape 10,231 10.1Varietal red wine Favorita Diaz 9,197 9.1

Varietal red wine Cabernet Sauvignon 8,044 8.0

Varietal red wine Syrah 5,523 5.5

Table red wine Grenach 4,761 4.7Table red wine Alfonso La Valle and/or

Rivier4,296 4.3

Varietal red wine Malbec 3,717 3.7

Table red wine Cariñena 3,183 3.2Varietal white wine

Chenin 2,742 2.7

Varietal red wine Merlot 2,569 2.5

Varietal red wine Tempranillo 2,237 2.2

Varietal white wine

Ugni Blanc 1,948 1.9

Varietal white wine

Franc Colombard 1,735 1.7

Varietal red wine Barbera de Asti 1,702 1.7

Table red wine Cereza 1,296 1.3Varietal white wine

Riesling 1,087 1.1

Varietal white wine

Sauvignon Blanc 1,063 1.1

Table red wine Vischoqueña 969 1.0Others (includes 18 varieties)

5,760 5.5

TOTAL 101,02 100%

Bottleneck for exports – Available grape variety

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Grapes


• In 2009 Cadastre registered 539ha table grapes, 689 wine grapes and 360ha singani

Bottleneck – local consumption of 10 million liters assumes limited interest for exports

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Exports


• Hardly any exports of Bolivian Wines:

Less then USD 50,000 per year (of which large proportion to China)

Bottleneck – Limited expertise and experience with exports Bottleneck – Limited awareness of market potential

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Quality

• Limited quality assurance (HACCP) nor ISO registrations

• Complicated quality registration process (SENASAG)


Bottleneck – No certificate of Origin without Quality registration

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Corporate Social Responsibility (CSR)


• Large proportion of family growers (limited social requirements)

• Environmental standards are implemented scarcely

• Required training and education to wineries and grape growers

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Supply Chain

• Complicated and lengthy procedures for imports of raw material such as glass and cork

• No glass factory - limited local demand


Bottleneck – A great dependency on complicated Imports of raw materials

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Bolivian Wine Stakeholders


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Stakeholders


• A variety of Wine Associations exist (ANIV, AMEVIT, ASOBOC, AVISA)

• Limited budget, limited awareness, limited grapes, limited wineries

• Co-operation? A collective sectoral approach is the challenge

Bottleneck – No coordination & structural information sharing between associations

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Stakeholders

• Large institutional landscape with individual service providers (IBCE, FAUTAPO, CENAVIT, SENASAG, IBNORCA, CAINCO, CADEX, CANEB, FTE)

• Some funds available for viticulture, export promotion (CBI, NL Embassy, BID)


Wine Sector Platform required to co-ordinate efforts

grape growers

dry goods suppliers

wineries

importers

retailers

consumers

supporting functions

rules & regulations

Wine BSOsBSOs

ministry of agriculture

informing & communicating

quality control, taxes, permits

donors

Bottlenecks for Exports: Summary

10-04-2023 CBI - Ministry of Foreign Affairs17

Insufficient supply of grapes for the Export Market

Quality of supply of grapes for the Export Market

Lack of certification bodies

Black Markets and illegal imports

Dependency of imports raw materials

Local market is sufficient to current offer

Small economies of scale resulting in relative high cost prices

Zero awareness of Bolivia and Bolivian wines in target markets

Lack of efficient and collaborative approach for the whole sector

Lack of export knowledge and skills

Percepciones del mercado desde las empresas (inteligencia)

Cuellos de Botella

Reactivación SENAVIT: Laboratorio para la certificación del producto, Investigación de producto

Asistencia financiera (productos específicos), mecanismos de financiamiento.


Opportunities in exports

There are a few EU markets that clearly have potential:

Open consumer opinion; markets that are open to new trends

(UK, Netherlands and to lesser extend Sweden, Denmark and Germany)

New wine markets; short wine drinking tradition, are open to try new things.

(Poland)


Market Opportunities


Relative high production / export pricesRelative small available export volumes

United KingdomNetherlandsGermanyDenmarkSwedenPoland

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Bolivian wine focus on (Super) Premium category

Specialist retailHoreca

Market Opportunities: UK


Retail - 72,5% marketshare - nearly 1 billion literSpecialist channel 8,3% market share - nearly 80 million literSouth American category 10% - approx. 8 million liter

Potential Bolivia 10% of South American category ?

Market Opportunities: Netherlands


Retail - 80% marketshare - 200 million literBig focus on wines below € 4,99 price pointSouth American category within Specialist channel 2,5 million liter

Potential Bolivia 10% of South American category ?

Market Opportunities: Denmark


Retail - 80% marketshareLarge number of small importers with own specialist wine shops 27% of wines come from Developing Countries - 10 million liter

Potential Bolivia 5% of Developing Countries category

Market Opportunities: Sweden


Retail - monopoly market (1 buyer) nearly 200 million literNo specialist channel availableSmall Horeca market

Potential Bolivia for a small tender with Systembolaget?

Market Opportunities: Germany


Large market (50% own production/50% imports) nearly 2 billion literOnly 3% of sales > € 5,00 - still nearly 70 million liter

Potential Bolivia 0,5% of premium category ?

Market Opportunities: Poland


New wine market - growing consumption, now estimated 50 million literSpecialist channel - nearly 3 million liter

Potential Bolivia 1% of specialist wine sales ?

Your input and Feedback

Complete overview of bottlenecks?

Validation: is the contents of the VCA in line with your view?


Bottlenecks

Bottlenecks Validated

Conocimiento y experiencia en la exportación


24 10-12 presentation vca marco tiggelman

Documents

wine grapes

foreign affairs

wine table red wine

varietal red wine malbec3

varietal red wine tempranillo

varietal red wine merlot2

table red wine cariena

table red wine cereza