Now a leading French wine maker has put Ethiopia on the international wine map, with its new products from its vineyard in southern Ethiopia.
After a deal was struck between the late PM Meles Zenawi and Pierre Castel, founder and President of the Castel Group and BGI International to establish Castel Winery in Ethiopia that faithful day in 2007, the company immediately assigned the best experts and consultants in the business from France to select the most suitable area for a vineyard which can meet Castel Family’s strict three generations old quality wine making standards and criteria. After a thorough investigation by the panel of experts, the town of Battu (Zeway), 163 kilometers south of Addis Ababa was selected.
And the birth of Castel Winery was officially endorsed on May 2007 with the ceremony of the first vine plantation.
This FDI that became fruitful after almost seven years officially introduced its international taste with a big celebration in the presence of officials including PM Hailemariam Desalegn on Saturday March 22 at Battu.
Through hard work, resilience and innovation, and under the guiding hand of founding President Pierre Castel, today the Group has become the largest wine producer in France and Europe and the third largest wine producer worldwide, and became the owner of the second largest beer and soft drink businesses in Africa.
Castel Group, one of the first very few foreign based companies that has come to defy the Ethiopian market after the downfall of the Derg regime and its command economy, joined the Ethiopia beverage industry after it decided to erect a brewery at Kombolcha Amhara Regional State with a USD 25 million dollar investment in 1997 and then it bought the long established brewery, St George, in 1998 at a cost of USD 10 million.
Since then the French based giant, that is demonstrating the benefits of doing business in Ethiopia for other global investors, has played a big role to heat the beverage industry in the country and to be a specimen for other dominant foreign firms to be part of the country’s development by establishing their business in Ethiopia.
The St. George Brewery, established state of the art infrastructure, since Castel Group/BGI Ethiopia owned it with a big market share has been introducing new local and international brands for the beer industry and now it can easily change the market with international standards.
BGI, that leads the beer market in Ethiopia with over half of the market share has also invested a huge amount to expand the Addis Ababa brewery plant, with branches in north eastern and southern part of the country at Kombolcha and Hawassa (Awassa) towns respectively.
Castel Group was established in Bordeaux, France in 1949 by founder Pierre Castel and his 8 brothers and sisters. It is a good example of foreign direct investment (FDI) in Ethiopia. The family growing up in the vineyards of Bordeaux meant that wine was already an integral part of their daily lives. “Theirs truly is a family affair. Their driving principle was to share their love of wine and other high-quality products in a way, which fulfills every customer’s expectations. With this ethos firmly in mind, not even rapid expansions have been able to undermine the core values, which shape Castle’s businesses spirit and identity,” the company profile reads.
In the 50’s and the 60’s, the Group embarked upon an internal expansion by setting up bottling plants. Keeping intact their special attachment to the internationally acclaimed wine making region of Bordeaux, the Group expanded to other known wine making regions of France like the Loire, the Rhône, Burgundy, Provence, the Languedoc and the South West, and within few years it spread all over the world with its dominant brands.
Meanwhile, Castel Group was also busy establishing a reputation in the beer and soft drink sector in many parts of Africa. The Group became one of the key players in the continent when they acquired BGI (Brasseries et Glacières Internationales) in 1990.
The company that joined the Ethiopian market 17 years ago is still a major market actor in the Ethiopian beer industry.
Officials of BGI Ethiopia told Capital that currently the brewery is investing millions of dollars every year to meet the growing demand of its brands in the country. Not only is the company expanding its business, but the biggest brewery in Ethiopia has also bought significant share on the under construction brewery, Raya.
Currently, BGI Ethiopia bottles St George, Castel, Bati and Amber (St George), which is the first amber beer product for the country, though it has a plan to introduce other new brands to the beer market.
Facts about the new winery
- Out of the 450 hectares given to Castel, the vineyard is planted on 162 hectares with an investment of 520 million birr.
- The plantation of all the grape varieties lasted until the beginning of 2009.
- At the start of 2011, while the grapes are maturing in the vineyard, construction of the state of the art winery went underway and was completed in less than a year.
- Castel Winery has two product lines; Rift Valley and Acacia.
- The four types of grapes Castel Winery currently grows to produce red and white wines are Syrah, Merlot, Cabernet Sauvignon and Chardonnay.
- Acacia Dry Red, Acacia Medium Sweet White, Acacia Medium Sweet Red, Rift Valley Syrah, Rift Valley Merlot, Rift Valley Cabernet Sauvignon and Rift Valley Chardonnay are the brands introduced from its farm located at Zeway, part of the great rift valley.
- The winery has a production capacity of 1.4 million bottles.
- Half of the product will be exported to major markets in China, USA and Europe
- Castel Group will continue to make expansion.