Champagne shipments drop by 5m bottles during 2018

Initial estimates for the past year show that Champagne has shipped 5.3 million bottles fewer than 2017, driven by falling demand in France and the UK.

Champagne shipments are down by more than 5m bottles on 2017, but the region may have reached a new record in turnover

Although such a figure is only an estimate, it would mean that shipments have decreased by 1.7%, with the total number of bottles dropping from 307.3m in 2017 to 302m for the past year, although there is a sense in the region that the final sum could be lower.

Speaking to the drinks business on Friday in Champagne, co-president of the Comité Champagne, Jean-Marie Barillère, confirmed that the region’s “first estimate” was 302m bottles, but added that “the reality” would probably be below that figure due to a failure to fully account for the extent of the impact of demonstrations by the gilets jaunes, which were particularly disruptive in the centre of Paris in the run up to Christmas.

Taking place in France in the final six weeks of the year, rioting in France’s capital led to the closure of key shopping districts, most notably the Champs-Élysées, which also sustained extensive damage from acts of vandalism to upmarket retailers in the area, made especially harmful as it was during their most important trading time.

While the impact was strongest for branded goods, such was the negative affect on the national psyche, Champagne sales fell across the country during the most voluminous month of the year for the consumption of the sparkling wine.

Road blocks across the country also affected the delivery of Champagne to key retailers in France.

“The gilets jaunes had an affect on Champagne both because of what it meant for logistics, but also the moral of the people,” said Barillère.

To prove that French consumers weren’t spending money during this period, he recorded that savings had been unusually elevated. “Total deposits in the banks were at one of their highest levels ever at the end of November because people weren’t spending, they were saving,” he said.

Continuing he stated, “Champagne is not a necessity, and when you don’t know what’s going on, then you won’t spend as much as you could.”

Barillère noted that the drop in volume sales of Champagne in 2018 wasn’t only the result of declines in France, but also due to a fall-off in sales in the product’s next biggest market – the UK.

Such a drop he ascribed to uncertainty over the economic implications of Brexit.

“People aren’t spending much in London either because they don’t know where you are going,” he said.

“So Champagne’s two biggest markets are seeing decline, although for different reasons,” he added.

Having said that, both markets have been experiencing the same trend in the multiple retail sector, where the demand for entry-level Champagne sold on discounts in supermarkets has diminished.

This is believed to be both because the regularity and depth of such discounts has declined, but also because of a falling appetite for inexpensive Champagne that doesn’t carry the name of a respected producer.

“Clearly it is the entry-level that is suffering a lot, and that could be Champagne from the houses, the growers, or the coops,” said Barillère.

Commenting on this end of the category, Charles Philipponnat, who is head of Champagne Philipponnat, told db that cheap Champagne had lost its appeal.

“In France, the big problem is that the bottom end of the market is increasingly lacking attractiveness: €12 Champagne is not exciting, and it not a good deal any more, because it has been all over the place for too long; people are fed up with it,” he said.

While Champagne is seeing shipments decline for inexpensive Champagne in mature markets, the premium branded sector is doing well, both in Europe, but particularly in the US, Japan and Australia.

As a result, Barillère said that turnover for Champagne in 2018 was “stable”, and may even have increased to a level slightly above last year, which was a new record for the fizz.

In other words, the region may have lost more than 5m bottles in shipments for 2018, but the past year could represent the largest ever turnover for Champagne, with the higher revenue accounted for by sales of more branded bottles, and an increased demand for pricier cuvées, especially from consumers in countries outside Europe.

Observing such a development, president of Champagne Deutz, Fabrice Rosset, told db that people were prepared to buy the fizz at high prices, but only if it came from a trusted and critically-acclaimed source.

“The word Champagne is not enough; what’s on the bottle counts more and more,” he said.

Champagne shipments* over the past 10 years:

2018: 302m (estimate)
2017: 307.3m
2016: 306.1m
2015: 313m
2014: 307m
2013: 305m
2012: 309m
2011: 323m
2010: 319m
2009: 293m

The estimated total quantity for 2018 takes Champagne shipments back to their lowest level since 2009, when the region suffered a sharp decline in sales due to the global financial crisis, having enjoyed two bumper years, with shipments totalling 323m and 339m in 2008 and 2007 respectively.

* Shipments refers to stock that has left the cellars and warehouses of Champagne producers, and therefore covers the domestic market as well as exports. Also, it represents the delivery of stocks, not actual sales.