The wine industry in France is navigating turbulent waters, with declining sales both domestically and internationally despite a bountiful grape harvest.
Despite an above-average yield in 2023, France's winegrowers are facing significant challenges. The decline in sales can be attributed to a multitude of factors, including rising inflation and shifting consumption habits among the French populace.
While the 2023 grape harvest marked a notable increase in production, with a 4% rise compared to the previous year and an 8% surge compared to the average over the preceding five years, the optimism was short-lived. Between August and December 2023, exports of origin-protected (AOP) wines saw a notable downturn, with volumes dropping by 7% and commercial value decreasing by 5%. The situation worsened for other wine varieties, with exports plummeting by 16% in volume and 11% in commercial value. Cognac and champagne, two iconic French beverages, also experienced significant declines in export volumes, falling by 18% and 17% respectively.
Compounding the issue, the producer prices for France's winegrowers experienced a sharp decline. Between August and December 2023, producer prices plummeted by 13% compared to the same period in the previous year and by 9% compared to the preceding five years. The sole exception to this trend was champagne, which saw a notable increase of 10% in producer prices.
The adverse effects of inflation further exacerbated the challenges faced by the French wine industry. Inflation not only contributed to the decline in exports but also had a detrimental impact on domestic wine sales. Retail wine sales within France witnessed a consecutive decline, dropping by 4% in 2023 following a similar decline in 2022. Red wines bore the brunt of this decline, experiencing a 9% decrease in sales, while white wines and rosé saw respective declines of 4% and 2%.
In summary, despite a promising harvest, France's wine industry is grappling with a complex set of challenges, including declining sales both domestically and abroad, falling producer prices, and the impact of inflation on consumer behavior. Navigating these challenges will require innovative strategies and adaptability from all stakeholders in the industry.