Despite an above-average vintage last year, France's winemakers are in a bind. Because sales at home and abroad are declining, producer prices are falling. The reasons for this are inflation and the fact that the French are drinking less wine, as the Ministry of Agriculture in Paris announced in its most recent market analysis.
Between August and December 2023, exports of origin-protected wines fell by seven percent in volume and by five percent in commercial value. Exports of other wines even fell by 16 and 11 percent respectively. The amount of cognac exported fell by 18 percent and that of champagne by 17 percent.
The producer prices of France's winemakers fell by 13 percent between August and December 2023 compared to the same period last year and by 9 percent compared to the five previous years, according to the ministry's data. Only producer prices for champagne increased by ten percent.
Inflation contributes to the decline in exports
Inflation contributed to the decline in exports and also had a negative impact on domestic wine sales, the ministry said. Retail wine sales in France fell by four percent in 2023 after an equally high decline in 2022. Red wines, with a minus of nine percent, were more affected than white wine (minus four percent) and rosé (minus two percent).
In France, the effects of inflation are compounded by a long-term trend that is increasingly causing problems for the wine country: the French are drinking less and less wine and, as the ministry's analysis shows, they are turning to other alcoholic beverages and especially beer.
The reasons for this are a changing lifestyle with fewer traditional meals in large groups, more single households where wine is more likely to be drunk in company, and the fact that the culture of drinking wine is no longer automatically passed on in families, according to the industry association Vin
Outrage over offer: Bordeaux for 1.66 euros
In the traditional wine-growing region around Bordeaux, the government has already responded to the overproduction of wine and the sales problems for what is probably the best-known of French red wines with clearing bonuses for setting aside cultivated areas. A few days ago, the supermarket chain Carrefour caused outrage in the industry, offering a good Bordeaux for the price of 1.66 euros each when purchasing several bottles.
Winegrowers complained about another low point in a wine discount battle after they had recently protested against a red wine offer at Lidl for 1.89 euros a bottle. The marketer of the corresponding Bordeaux spoke of an advertising campaign at his own expense that had no negative impact on the winemakers' income.
The 2023 vintage should have given French winemakers reason to be happy. At 48 million hectoliters, this was four percent higher than the previous year and eight percent higher than the average for the years 2018-2022.
