The French government and the European Union (EU) have announced their plan to allocate a total of €200 million ($216 million) to address the issue of wine surpluses in France. This move comes in response to falling demand and declining prices in the country’s wine industry, which has resulted in overproduction and an excess supply.
Agriculture Minister Marc Fesneau highlighted the objective of the financial investment, stating that it is aimed at preventing a collapse in prices and enabling wine-makers to generate revenue once again. Fesneau further emphasized the need for the entire industry to adapt to changing consumer preferences.
To deal with the surplus wine, there have been suggestions to sell the alcohol to companies that produce hand sanitizers, cleaning products, and perfume. This would provide an alternative use for the condemned wine and help mitigate the economic impact of the surplus.
The regions most affected by the wine surplus are the renowned Bordeaux area and the southwestern Languedoc region. These areas, known for their rich winemaking traditions, have suffered from the oversupply and the subsequent decrease in prices.
Earlier this month, Jean-Philippe Granier, a representative from the Languedoc wine producers’ association, expressed concerns about the excessive production and the sale price being lower than the production cost, resulting in financial losses for the industry.
In June, the French Agriculture Ministry announced its plan to allocate €57 million to support the destruction of around 9,500 hectares of vineyards in the Bordeaux region. Additionally, financial incentives have been provided to grape growers to encourage them to diversify their products and switch to other crops.
The surplus in the wine industry can be attributed to a combination of high inflation and a strong harvest in 2022, which led to a decrease in wine consumption. According to data from the European Commission, wine consumption fell by 7% in Italy, 10% in Spain, 15% in France, 22% in Germany, and 34% in Portugal. The decline in wine consumption has also resulted in a decrease in the bloc’s wine exports between January and April 2023, with a decline of 8.5% compared to the same period in the previous year.
In conclusion, the French government and the EU have approved a significant financial investment to address the issue of wine surpluses in France. The aim of this investment is to prevent the collapse of wine prices and enable wine-makers to regain sources of revenue. The surplus wine could potentially be sold to industries that produce hand sanitizers, cleaning products, and perfume. The regions most affected by the surplus are Bordeaux and Languedoc. The surplus is a result of falling demand, overproduction, and declining prices in the wine industry. Measures such as financial incentives and vineyard destruction have been implemented to mitigate the impact of the surplus.
Source link
