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Drinkers’ dwindling appetite for French wine has left farmers with an oversupply that the government plans to spend €200 million to eradicate.
The French Ministry of Agriculture has received EU approval and financial support for the payment of so-called crisis distillation subsidies, which are expected to go mainly to the Bordeaux and Languedoc regions. Under the program, wine is distilled into ethanol that can be sold for industrial uses, such as perfume or hydroalcoholic gel.
It’s part of a broader government effort to help the country’s wine producers adjust to falling demand from French wine drinkers, competition in the export market and weaker sales in China.
During a visit to a distillery on Friday, Agriculture Minister Marc Fesneau said the government was trying to “stop the price fall and.” [help] Winemakers are finding new sources of income.” He added that farmers “need to adapt to changes in consumption and adapt production to tomorrow’s demand.”
The wine industry had estimated that this year’s surplus would be up to 3 million hectoliters, equivalent to 7 percent of last year’s production of 42 million hectoliters. She had campaigned for crisis aid for the distillation of 240 million euros.
Another system compensates farmers willing to demolish vineyards and convert the land to forest or leave it fallow. About 1,000 farmers in Bordeaux have applied for such aid to remove 9,200 hectares of vines, which is about 8 percent of the total area under vines in the region.
The moves come as the country’s harvest season known as vendange begins, mobilizing hundreds of thousands of contract workers for a period of four to six weeks. The calendar of the vendange has been shifting further and further forward in recent years due to rising temperatures associated with climate change. In Champagne, the harvest was pushed back by three to four weeks.
Prospects for production vary by region this year, with some regions such as Languedoc-Roussillon being hit by drought, while blight caused by alternating storms and high temperatures are affecting production in south-western vineyards. However, Champagne expects better yields and total volumes should remain stable compared to last year.
According to a study by market researcher Kantar, the French’s red wine consumption fell by 32 percent in the decade to 2022, with sharp falls among young people, many of whom prefer spirits and beer or simply drink less alcohol.
Demand for premium wines and champagnes has held up better than cheaper table wines, with some French producers successfully switching to the upper market to meet lower demand. Rosé wines are also growing in popularity, with major groups like LVMH and Pernod Ricard taking over names like Whispering Angel and Sainte Marguerite en Provence.
According to the Association of French Wine and Spirits Exporters, wine and spirits remain among the top products for French exports, reaching 17.2 billion euros last year, up 10 percent from the previous year.
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