French Wine Sector: It's Getting very Complicated!

French Red wine suffered with sales falling by 5% over one season. Faced with a historically negative economic situation, both domestic and export sales have declined. Particularly affected, red wine saw its sales fall by 5% in volume and value in supermarkets in France over the wine marketing campaign which runs from August 1, 2019 to July 31, 2020.

Only whites and rosés resisted the shock, with respective increases of 0.9% in value for whites and 1.2% for rosés in supermarkets over the same period.

From the beginning of March to the end of May, when the entire population was at home, sales in supermarkets increased slightly in volume (+ 1.1%), excluding sparkling wines. But the confined French bought wines cheaper than in restaurants and the turnover of the sector fell by 3.1%.

Exports fell 18% in value from January to August 2020 compared to the comparable eight months of 2019, according.

In these less festive periods, sparkling wines (champagne and crémant) are the most affected with exports down 22% in volume and 28% in value over the period. Those of still wines fell by only 6% in volume and 13% in value.

Over the August-July wine "campaign", exports fell by 10% in total, all wines combined.

This is the first time since 2008-2009 that a marked drop has occurred in the wine export market, traditionally the second largest contributor to the French trade balance behind aeronautics.

A hard blow for a sector which, although uses only 3% of the country's cultivated land, accounts for 15% of its agricultural production and generates nearly 500,000 jobs, direct and indirect.

The closing of restaurants almost simultaneously in many countries of the world, where French bottles represent a good part of the wine list; the imposition of taxes of 20% in the United States since October 2019 on still bellow 14 degrees; and uncertainties related to Brexit, Great Britain being one of the first customers of French Wine.

To avoid the collapse of the market, a series of support measures have been decided, starting with 246 million euros of aid for crisis distillation financed from European and French funds.

Winegrowers have also asked for the creation of a compensation fund to compensate for the some 500 million euros of damage they believe they have suffered since the imposition of the "Trump tax" on the United States. United in retaliation to an aeronautical conflict.

On the other hand, the deputies adopted Wednesday evening, an amendment providing for a reduction in their employers' social charges. The text provides in particular for a 100% reduction for companies whose turnover has fallen in 2020 by at least 60% compared to 2019.