If the current trend prevails, France will fall behind Spain in 2015 when its wine production is expected to drop to 43.9 million hectoliters from the annual average of 52.8 million hectoliters in 2000-04, according to a study by the living body research group 'Credoc' for the Vignerons Independents winemakers association.
The rising Spanish production will overtake it seven years from now if the current trend continues. The study also shows that Spain has been trying to adapt to the new market conditions and standards set by the innovations from the US, South America, Australia and New Zealand whereas France has failed to do so.
There has also been a continuous decrease in the domestic consumption due to stricter advertisement, other government regulations and heath concerns. In particular, red wine consumption fell 2.6 percent per year during the past eight years and is expected to fall by 1.1 per cent annually until 2015, the report estimates.
French wine is expected to continue losing market share to New World competitors in its traditional western European markets but also in the UK, America, China and Japan.
French wine exports misleading
If one looks at last year's export figures released by the French wine and spirit industry they might be misleading. It exported nearly $15 billion worth, which is a record with an annual increase of nearly 7 percent, declared the French Federation of Wine and Spirits Exporters.
But the export performance does not unmask the broader crisis which is brewing. While Champagne and fine Bordeaux and Burgundy find increasing foreign markets, cheap wines and lesser-known wine regions have been struggling against competitors from New World countries, such as Australia, Argentina and Chile.
The continuing overproduction has forced many producers to distill millions of liters of otherwise drinkable wine into alcohol for use in disinfectants, cleansing agents or petrol additives.
Bucking the trend
Faced with projections the independent winegrowers, who produce just under half of the country's wine and whose association had instituted the studies, have pledged to buck the trend by banding together and pledging to adapt to the changing markets.
Eric Rosaz, Director of the independent winegrowers' association told AP, 'I am convinced that France has the arms to fight and keep her place as leader, but for this we need to get away from weight of history, the weight of our culture, and enter a new dynamic situation,"
He added that the French producers have been making progress to make their wine more accessible and hold at bay the New World winemakers. But more needs to be done. Screw caps, boxed wines, colourful easy-to-understand labels and sophisticated and innovative marketing techniques pioneered by countries like Australia and South Africa are already being tried.
The independent producers also plan to pool some logistical and commercial costs to reduce overheads and club together to gain better market access, especially in the supermarkets, as the survey suggested.
The survey also suggests that winemakers need to adapt to the tastes of new types of consumers paying attention to flavours, packaging, and marketing. 'We have the best terroir, the best wine, and the best image of wine in the world, but we have problems at the company level and in terms of dynamism, 'says the report, adding,' France must adapt to the American and British taste buds.'
The survey also assumes that the Spanish wines, which incidentally are getting increasingly popular in India, will continue to maintain their popularity in order to justify the increase in production. |