Record year for French champagne fails to cheer grape growers

REIMS, FRANCE Last year was a stellar year for French champagne, with 307 million bottles sold for a record 4.9 billion euros (S$8 billion) - but many growing the grapes see little to celebrate.

Sales in France actually fell amid rising competition from Italian prosecco and Spanish cava, meaning vineyard owners hoping to sell their own bubbly are having to rethink strategies .

The big champagne houses - names such as Krug, Moet & Chandon and Veuve Clicquot - accounted for 72 per cent of total sales, which rose by 0.4 per cent.

Smaller vineyards and cooperatives made up the rest, but their share has been shrinking, thanks to their reliance on the domestic market.

"From 2007 to 2016, the vineyards have lost 25 per cent of their shipments by volume," said Ms Aurelie Ringeval-Deluze, a wine industry expert at the University of Reims, in the heart of champagne country.

Sales in France dipped 2.5 per cent last year - but the drop was 4.9 per cent for the smaller houses, or 2.5 million fewer bottles, according to the Champagne Committee trade body.

"The problem is that the French market is tough, very competitive... but 80 per cent of vineyards sell their champagne in France," said Mr Maxime Toubart, head of the Champagne Winegrowers' Union.

Restrictions meant to ensure quality - like ageing the wine at least 18 months - mean that champagne is pricier than other domestic and foreign sparkling wines, and French consumers have been feeling the pinch after a decade of dismal economic growth.

As a result, more vineyards are selling their grapes directly to the big houses instead of trying to compete with their own champagne.

"Vineyards are increasingly dependent on the houses to sell their stocks, because they have the means to go sell the bottles in distant markets at high prices," Mr Toubart said.

"So they can afford to pay a lot for the grapes."

Of the roughly 15,800 vineyards counted by the Champagne Committee for 2016, about 4,400 produce and sell their own bottles - a number that has been falling steadily.

Many of those hoping to stay in the game are themselves trying to sell beyond France, encouraged by the 8.4 per cent rise in exports last year.

"About half of my production, 15,000 bottles, goes to the US, Italy, Sweden and Denmark," said Mr Benoit Velut, a young Montgueux grower.

That represents 3ha of his 7.7ha vineyard, with the remaining grapes sold to the 300 big champagne houses, which often have only token vineyards of their own.

He realised that the ground has shifted, "from a local clientele in our parents' time to one that is spread much more around France, even as foreign markets develop".

But small growers often lack the wherewithal to tap into new markets. So Mr Velut has joined forces with 10 other vineyards to pool their resources and know-how.

The union is also trying to help - inviting producers to industry shows and offering English classes - though so far it hasn't stopped the decline in volumes, Mr Toubart said. - AFP