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What happens if too much wine is produced? The French case

For the first time in several years, it appears that Italy is about to lose its status as the world’s leading wine producer. This leading position would be surpassed in terms of volume by France, provided that initial assessments regarding the currently ongoing harvest, which is affected by high temperatures, are confirmed. This finding emerges from analysis conducted by Coldiretti, focusing on the situation of the harvest currently underway in both Italy and France. Coldiretti highlights that a 14 percent reduction is expected in wine production in Italy, estimated at around 43 million hectoliters compared to the 50 million recorded in the previous season.

In contrast, despite the damage caused by Downy mildew and drought, estimates provided by the statistics service of the French Ministry of Agriculture indicate that the grape harvest in France is expected to range between 44 and 47 million hectoliters, maintaining a conformity with the average recorded in the 2018-2022 period. This development could represent a historic overtaking in terms of production volumes.

What about consumption?

However, France is also faced with another relevant fact: a significant decline in consumer demand for wine. According to the most recent information provided by the European Union Commission, there has been a 15 percent decline in wine consumption in France (and a 7 percent decline in Italy). This decline in demand occurred in parallel with an increase in production.

Indeed, in France this surplus in production can be attributed to several factors, including falling demand and rising prices. But a decisive factor is related to changes in consumer preferences, which are showing an increasing preference for craft beer over wine.

The solutions

Therefore, the French government has resolved to allocate 200 million euros (with initial funding of 160 million euros from the European Union) to purchase the surplus stock. The surplus wine produced will be disposed of and turned into alcohol that can be used for non-food products, such as cleaning products and perfumes.

In June, the Ministry of Agriculture announced the allocation of 57 million euros to support the culling of 9,500 hectares of vineyards in Bordeaux. Additional public funding is available to encourage winegrowers to move to other forms of production, including olive oil. Marc Fesneau, France’s Minister of Agriculture, explained that the goal is “to counter the fall in wine prices and help producers discover new sources of income,” while also stressing “the importance of adapting to changing consumer behavior and the wine industry moving into the future.” The Agriculture Minister explained that the funding will be used to incentivize winegrowers to diversify their production, such as switching from wine to olive production.

In conclusion, in a landscape of change and challenges, the willingness to innovate and restructure emerges as fundamental to the wine industry. Adaptation to consumer preferences and the pursuit of economic sustainability loom large as the keys to preserving the millennial heritage of the wine world.