The European wine industry is preparing for a turbulent 2024, as production is expected to decrease by nearly 3%, according to a recent report from farming union Copa-Cogeca.
The data, sourced from 24 EU member states, forecasts a total production of approximately 144 million hectolitres (Mhl) of wine and must, representing a significant 10% drop compared to the five-year average.
Key Highlights of the Report
Italy Maintains Leadership
Italy is poised to lead EU wine production with an estimated output of 41 Mhl, holding its place as the top producer. This figure reflects the country’s resilience in the face of challenging climatic conditions, although it still falls below long-term averages.
Spain Rises in Rankings
Spain is forecasted to produce 38.1 Mhl, an impressive 18% increase from the previous year. This growth stands out in a year marked by production declines across much of Europe.
France Suffers a Significant Decline
France, historically a wine powerhouse, is grappling with a 22% drop in output, bringing its production down to 37.4 Mhl. This decline is attributed to adverse weather conditions and the residual effects of recent droughts that have stressed vineyards.
Germany and Portugal See Declines
Germany’s wine production is projected to decline by 8.7%, while Portugal is expected to see a 7.9% reduction. These decreases further underscore the broad impact of climate and market challenges on the European wine sector.
Challenges Impacting the 2024 Vintage
Copa-Cogeca emphasized that 2024 has been a particularly challenging year for wine producers. Key issues include:
- Adverse Climatic Conditions: Unpredictable weather patterns, including droughts and inconsistent rainfall, led to uneven harvests across the continent.
- Water Scarcity: Southern regions of Europe, including Spain and Italy, faced severe water shortages, which prompted earlier-than-usual harvests.
- Economic Pressures: Rising production costs and shifting international trade dynamics have compounded the difficulties for winemakers.
National and EU-Level Responses
To mitigate these challenges, several measures have been introduced:
- France’s Grub-Up Scheme: The French government announced a €120 million program to remove 30,000 hectares of vineyards, offering growers €4,000 per hectare. This initiative aims to rebalance the market but prohibits replanting until at least 2030.
- EU Policy Initiatives: In July, the EU formed a wine-policy group to address sector-wide challenges. Representatives will meet three times and deliver recommendations for future policies by early 2025.
- Spain’s Aid Package: The European Commission approved financial support for Spain's Rioja wine region in August, providing relief to one of the country’s most important wine-producing areas.
Resilience in the Face of Adversity
Despite these challenges, Copa-Cogeca’s wine working party president, Luca Rigotti, remains optimistic about the resilience of European winemakers. He highlights their ability to adapt to shifting conditions and market demands, maintaining Europe's leadership in global wine production.
Source: Yahoo Finance