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Ukrainian Wine Industry’s Positive Outlook

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October 16, 2023 – Despite the on-going Russian invasion and warfare, as paradoxical as it sounds, Ukraine’s wineries that are still operational are doing well and business is growing. 

Ukrainians are drinking more local wine rather than the preferred imports.  Importing wine has become difficult logistically, and the collapse of the value of the hryvnia has increased prices exponentially encouraging locals to turn to domestic offerings, which in the past were regarded as sweetish and inferior.  As a part of the USSR from 1922 to 1991 when the Soviet Union dissolved, Ukraine and neighboring wine producing countries like Georgia and Moldova emphasized quantity over quality (the same applied to vodka).  Prosperity didn’t exist so alcohol needed to be plentiful and cheap.  But at the turn of the century, things began to look up.

Winemakers became interested in the modern techniques used by European wineries from grape growing to vinification and increased investment encouraged modernization by the wineries.  Like their European counterparts, they focused on quality over quantity.  For the past dozen years or so, the Ukrainian wine industry has been driven to compete in foreign markets actually winning gold and silver medals at international wine competitions.  Fueled by national pride, the industry is growing quite rapidly at home, despite the extraordinary challenges.

While they are optimistic and enthusiastic, the dark side of the Russian invasion remains.  Russian have looted and destroyed many wineries and their vineyards.  Back in 2014 they seized Crimea, the largest source of grapes for Ukraine.  In the most recent invasion, they seized Prince Trubetskoi, the country’s biggest and oldest winery founded in 1895.  Buildings were totally destroyed along with equipment and the vast cellars were looted.  The vineyards were mined which will take years to clear before they can replant.  The owners have renamed the winery Stoic but the region is still under fire and the owners haven’t even been able to visit their property and assess the damage.

Day-to-day operations are affected by power cuts, bombing raids, glass shortages, high prices, and all the exigencies of operating in a war zone; it is hard to imagine any optimism in that environment. 

Much of the looted wine is a reward for loyal elite – read oligarchs.  And seizing property is another elitist reward.  One such beneficiary was former Minister of Agriculture Alexander Tkachev who is now one of the largest landowners in Russia owning 660,000 Ha.  At 2.47 acres to the hectare, he owns a staggering 163,020,000 acres.