Experts warn: US supplies are declining
French wine exports fell by 9.4 percent in 2023. This is the lowest level in at least 17 years, with supplies from Champagne, Bordeaux and all other major regions declining. At the same time, it is noted that the supply of strong drinks such as cognac fell by 15 percent due to a drop in demand for grape brandy in the United States.
< p>Exports of champagne and wine fell to 122.6 million cases in 2023 due to reduced supplies to the United States, the French Association of Wine and Spirits Exporters (FEV) said. Exports fell 3 percent in value as higher average bottle prices partially offset lower volumes.
After years of wine and spirits being France's second-largest export after the aviation industry, it dropped to third place in 2023, behind perfumes and cosmetics. FEV attributes this to inflation and lower incomes in lower consumption, as well as US importers reducing inventories after excess purchases in 2022.
“We are seeing a significant drop in volumes, there is no denying that,” explains the chief executive of the wine producer and AdVini trader Antoine Leccia. “We are not able to compensate for the volume effect due to the price effect.”
Export volume to the US fell 13 percent, while value fell 7.8 percent to €2.14 billion. Shipments to the UK fell by 5.2 percent, while the value of imports remained little changed at €1.46 billion.
The decline in US exports reflects an adjustment in inventory levels and does not mean consumption has fallen that much, FEV President Gabriel Piccard said. He notes that U.S. shipments could return to «more normal levels» in 2024 once excess inventories are cleared.
Champagne remained France's most important wine export, accounting for 37 percent of value exports.
According to David Chatillon, president of the Union of Champagne Producers, the region is experiencing a “premiumization” effect, which is leading to higher export prices, as well as increased consumer demand for high-end bottles such as rosé champagne.< /p>
As for the Bordeaux region, the entire entry-level segment is suffering, while the upper end of the market is holding up better. According to FEV, the French wine industry needs to ask itself questions and take a fresh look at how wine is consumed because «a lot of changes are happening.»
France's historic regions of Beaujolais and Languedoc-Roussillon recorded the largest declines in volumes among the major growth regions, with exports in both down about 16 percent. The Loire Valley bucked the trend, recording a 6 percent increase in export value.