Catalonian wineries are struggling in the pandemic context

Catalonian wineries are struggling in the pandemic context

That is because they depend on the strength of the tourism industry

One would not initially think that the wine industry would be having any particular issues owed to the global coronavirus pandemic. However, it is good to remember that much of its products are consumed not only at home but also at establishments that form the core of the hospitality industry, such as restaurants, bars and hotels and their closure means less consumer demand.

That is why the Government of Catalonia has decided to offer grants to small and medium wineries that meet certain conditions in order to help them retain their employees. The amount set aside for this measure totals 1.65 million euros.

Catalonia has 11 Denomination of Origin wine areas

The hospitality industry branch is also known as the HORECA in Spain, which stands for Hotels, Restaurants and Cafés. And this industry is directly dependent on the vitality of tourism and visits and as a consequence, it has been much publicized how the social distancing measures have been nothing but a bane to its continuing existence.

The wineries do not only supply local establishments, they also export their production beyond the borders of the autonomous region. Yet, it is quite telling that whereas Catalonian agri-food exports have experienced an increase of 4.37% in volume (and 9.18% in value) during the first half of 2020 (compared to 2019), regional wine exports have actually gone down by 4.07% in volume (and 13.55% in value).

It is expected that revenue from sales will be slashed down by one-third for the whole year. And while larger corporations have the capacity to apply for national and European subsidies, this is not the case for most of the 600 wineries operating in the region, which are run as small family businesses.

In this context, it was decided by the regional Department of Business and Knowledge to launch a line of grants targeted to these wine-producing SMEs.

In order to qualify as a beneficiary, a winery would have to be registered as a Catalonian Denomination of Origin producer, have an SME status and to have experienced a decrease in sales of at least 20% between March and June this year.

Each beneficiary will be able to get 1200 euros per employee, with the grant ceiling capped at 6000 euros per enterprise. The application period for financial aid is from 20 November until 17 December.



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