Champagne fall in UK results in curtailed French harvest

Heads of the French champagne industry have taken the decision to cut back on the harvest and the main reason is the bleak situation in the UK, which is the main export market for French champagne.

Evidence of the drain in sales of champagne in the UK has been accumulating recently. For example, Majestic Warehouses said that a fall in champers sales was a crucial reason for a 56% fall in profits. The wine and spirits division of Moet Hennessy, last month reported a 17% fall in sales in the first half of 2009. The luxury goods group, says that it had suffered from massive champagne destocking amongst distributors.

The Champagne region of France, which is situated in the north near Rheims, usually sets production at between 10,000 and 14,000 kilos per hectare. It has now set the limit at 9,700 kilos. However, this will not translate into the number of bottles on sale for 2-3 years. This inevitably means that UK retailers will have to continue managing problem of supply being greater than demand. There have been reports that supermarkets will be selling cut-price champagne in the pre-xmas period.

The situation contrasts with five years ago where the Daily Telegraph included the headline ‘Champagne Sales in Britain at Record High’ and reported that the “affluent younger generation has made champagne ‘their drink’”. It also quoted an analyst as saying that, if the state of an economy can be judged by the performance of the champagne market, the UK was “clearly booming”.

09 September 2009