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France to spend €200m destroying wine surplus

29 August 2023 By James Evison

The French agriculture ministry is injecting €200m to help assist producers with a dramatic surplus in wine as consumer demand shifts away from the beverage.

The cash pot is made up of €160m in crisis distillation aid from the EU and topped up to €200m by French funding, which will be used mainly in the Bordeaux and Languedoc regions. It will enable surplus wine to be distilled into ethanol for industrial uses, including perfumes and hydro-alcoholic gels.

It comes as the latest set of data from the European Commission has revealed a big drop in wine consumption across the traditional wine growing and drinking heartlands of Europe, with falls of 7% in Italy, 10% in Spain, 15% in France, 22% in Germany and more than a third in Portugal.

But the decline has come as wine production rose 4%. Figures have suggested the wine industry in France would have a surplus of three million hectolitres this year.

The move is part of a wider proposal by the French government to help winegrowers and farmers adapt to falling demand in wine drinking, alongside competition from a growing export market and lower sales across China.

On a visit to a distillery last week, agriculture minister Marc Fesneau said farmers needed to “adapt to changes in consumption and adjust production to the demand of tomorrow” and find new sources of revenue.

The news follows a different year climatically for the French and European wine industry as climate change continues to play a critical role in the ongoing viability of the sector. In June, db reported that a helpline has been set up by the local agricultural body in Bordeaux to help “traumatised” winegrowers deal with the devastating impact of a second bout of mildew.

In June 2022, Olivier Bernard, director of Domaine de Chevalier, said “global warming has been good for Bordeaux – the worst is in front of us.” He warned wine producers would have to “learn to put the foot on the break” and winemakers in Bordeaux would have to reconsider their mix of grapes to continue to make balanced wines if temperatures continue to rise, while noting that the future of whites from the region could be under threat.

“A warm terroir with 60-70% Merlot is already too much: Merlot was great when Bordeaux was looking for maturity,” he said, referring to the fact this grape ripens earlier than the other major grape in the region: Cabernet Sauvignon.

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