Struggling French winemakers may have to destroy their vintage cellars to survive

Several major wine-producing regions in France – particularly the vinyards of Bordeaux – are grappling with changes in consumption habits, the cost-of-living crisis and the after-effects of Covid-19 ... and the destruction of their vintage bottles of wine may be the only solution.

A Spanish wine merchant tastes Bordeaux red wines at the international wine fair "Vinexpo" in Bordeaux, southwestern France, in June 2007 (file photo). ASSOCIATED PRESS - BOB EDME

According to the local farmers' association, a fall in demand for wine has led to overproduction, a sharp fall in prices and major financial difficulties for up to one in three wine makers in the Bordeaux region.

An initial European Union fund, capped at €160 million for wine destruction has been increased to €200 million by the French government, according to Agriculture Minister Marc Fesneau.

The money is aimed at "stopping prices collapsing and so that wine-makers can find sources of revenue again," but he stressed that the industry needed to "look to the future, think about consumer changes, and adapt."

Au cœur de l’important territoire viticole qu’est l’Hérault 🍇, pour réaffirmer l’appui de l’État aux côtés des viticulteurs.

L’Etat s’engage auprès des viticulteurs et mobilisera la réserve de crise de l’Union européenne afin de compléter le budget de l’opération de… pic.twitter.com/GVZQmbDz5V

— Marc Fesneau (@MFesneau) August 25, 2023

The southwest Languedoc region – the country's largest wine area known for its full-bodied reds – has also been hit hard by the fall in wine demand.

The alcohol from destroyed wine can be sold to companies for use in non-food products such as hand sanitiser, cleaning products, or perfume.

"We're producing too much, and the sale price is below the production price, so we're losing money," Jean-Philippe Granier from the Languedoc wine producers' association told the AFP newswire.

In June the Ministry of Agriculture also announced a €57 million subsidy to uproot around 9,500 hectares of vines across the Bordeaux region, while other public funds are available to encourage grape-growers to switch to other products, such as olives.

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Output up, sales down

Europe last suffered a so-called "wine lake" in the mid-2000s, which forced the European Union to reform its farm policy to reduce the massive overproduction of wine which was being stimulated by its own subsidies.

According to EU figures, the 27-member bloc still spends just over €1 billion annually on the sector.

As well as a long-term trend of consumers switching into beer and other alcohols, the industry was badly hit by the Covid-19 pandemic which shut restaurants and bars worldwide, leading to a sharp fall in sales.

Recent rises in the price of food and fuel, linked to rocketing global energy prices and the invasion of Ukraine, have also seen buyers reduce their spending on non-essential goods such as wine.

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When approving emergency help for the sector in June, the European Commission said that wine consumption for the current year was estimated to have fallen 7 percent in Italy, 10 percent in Spain, 15 percent in France, 22 percent in Germany and 34 percent in Portugal.

Meanwhile, wine production across the bloc – the world's largest wine-producing region – rose by 4 percent.

The EU Commission said the worst affected vineyards were those producing red and rosé wines from certain regions of France, Spain and Portugal.

 (with newswires)