09/17/2020

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Champagne Producers Struggle With Drop in Demand



Celebration Cancelations Hurt Champagne Sales

The ongoing pandemic has put a cork in global demand for champagne. Many weddings, graduations, and other celebrations have been postponed or moved to Zoom. Consumers are also doing far less international travel and fine dining.

In France’s eastern Champagne region, producers say their sales have shrunk by $2 billion this year. They expect to have about 100 million extra unsold bottles of the luxury wine sitting in storage by the end of the year.

The CIVC’s Response

Le Comité Interprofessionnel du vin de Champagne, or the CIVC, is a government-sponsored group made up of champagne sellers and champagne grape growers. It oversees the production, distribution, and promotion of champagne. It also protects the Champagne label, which can only be used for wine produced with grapes grown in a specific region.

Just like in oil-producing countries, the CIVC controls the champagne grape harvest each year to protect the price of the region’s wine. The committee will meet in about 10 days and it is expected that they will implement strict caps on the distribution of grapes to champagne producers to avoid severe price drops.

The Impact on Farmers

The CIVC’s rules will likely force farmers to destroy grapes or sell them to distilleries at bargain prices. Wine grapes around the world have already gone to making alcohol for hand sanitizer, and now, champagne grapes may face the same fate.

Larger producers may appreciate these moves to protect the price of champagne in the long term, but smaller producers are much more vulnerable and could face severe financial hardships. Anselme Selosse, a fourth-generation wine producer noted, “Champagne has never lived through anything like this before, even in the World Wars.”


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