Due to COVID-19, sales of wines and sparkling wines have drastically declined since March. In Champagne, producers have decided to set a maximum threshold at 230 million bottles for the entire region, in order to reduce this year’s stocks and sell off last year’s bottles. The sector estimates the fall in its turnover this year to 1.7 billion euros.
An agreement had to be reached very quickly, since the harvest begins two weeks early this year, due to a lukewarm winter, a very hot spring and a warm summer with a few days above 40 degrees celsius. It’s now setlled, since last August 18: producers and Champagne houses agreed to reduce the volume of grape harvests to 8,000 kg per hectare, equivalent to 230 million bottles.
A yield down nearly 22% compared to 10,200 kg per hectare in 2019, said the Interprofessional Committee of Champagne Wine (CIVC) in a press release. Discussions had been stalled for weeks, with the big champagne houses pushing for a sharp drop in production to support prices, while some producers wanted a smaller cut to take advantage of a promising 2020 harvest.
In anticipation of the holiday season, a crucial time for champagne sales, and as the world tries to adjust to the fallout from the coronavirus epidemic, the industry has adopted an unprecedented measure to potentially reduce volume of the harvest, said the CIVC.
The CIVC estimates unsold products this year at nearly 100 million bottles, which represents a loss of turnover of 1.7 billion euros.
The majority of winegrowers have indeed lost more than 80% of their sales volume over the months of March, April and May or even June, which caused significant damage and increased the cost of stock. Restaurants and wine merchants represent more than 50% of the winegrowers’ sales volume, so by being closed for 3 months, they have also harmed the producers. Even this summer, restaurants have been very cautious about their purchases, fearing a second wave of confinement, they who have therefore preferred to use their existing stocks as a priority before making any purchase.
Individual tourists, who represent up to 40% of business in some areas, have also traveled much less, fearing the virus. Exports have also declined, especially to the United States due to the “Trump tax” since the end of last year. All this explains the concern of the winegrowers and the drop in yields for this year.
It is therefore, for us consumers, an excellent year to buy wine! Firstly, it supports our producers, but secondly, we can get better prices and above all, get allowances from winegrowers where it is usually impossible to get them!