Where have all the winegrowers gone?

An article originally published by Meininger's Wine Business International in August 2020

In 1960, according to Le Figaro, France had around 600,000 cafes and bars. By 2016, there were just 34,000. Apparently, 7,000 of these quintessentially French establishments close every year. Traditional artisan bakeries, les boulangeries, are also disappearing – at a rate of a hundred a month 

It’s also happening to France’s wine producers and grapegrowers. In 1995, according to Agrimer statistics, some 162,000 individuals and businesses completed the obligatory annual Declarations de Recolte harvest reports that inform the authorities of the number of litres of wine produced and/or the number of kilos of grapes picked and sold to a local cooperative or négociant.

Less than 25 years later, in 2018, the number of commercial declarations had more than halved, falling to 75,700.

Over the same period something even more dramatic happened to the people who grow grapes and make wine exclusively for their own family consumption. The number of their declarations fell by nearly 94% - from 129,000 to 8,500.

Many of those estates probably belonged to elderly couples, widows or widowers who may have been delighted to remain tucked up in bed rather than having to prune vines in near-zero temperatures. And, of course, the simple rules of economics apply. The economies of scale mean that it makes more sense to farm 20ha than five or 10.

But it's far too easy to focus on the numbers, and to forget that behind them stand real human beings. What do these trends mean for plots of land that have been lovingly tended by the same families for generations? What is the emotional impact on their owners who dreamed of passing them down to their sons and daughters?

It is easy to imagine that the contraction of France’s industry is a regional thing, focused on the parts of the country that are making the least commercially attractive wine. And the rate at which estates are closing certainly varies. Champagne, for example has seen a slight increase of 200 declarations – from 15,700 to 15,900 – which balances the loss of the same number in the Côte d’Or which is down to 1,400. But these areas are the exceptions to the national rule. Across the nation, an axe has sliced through the wine-growing and winemaking community.

In sheer volume of numbers, the worst hit region is Nouvelle Aquitaine, the region that includes Bordeaux and the départements of the Gironde, Dordogne, Lot et Garonne and Landes, which has lost 18,600 out of an initial 32,000 producers.

In Bordeaux, specifically, as figures separately compiled by Gavin Quinney reveal, over just 16 years - from 2015-20 - the world's most famous red wine region lost nearly half of its number of independent growers

But in percentage terms, the greatest devastation was in the Loire where 16,200 shrank to a meagre 3,200. Even Provence, home of one of France’s biggest export successes in recent years, lost nearly a third of its producers, while the number of estates in Occitanie, home to Languedoc-Roussillon, contracted by more than 40%.

Of course, to anyone used to the scale of New World production, the notion that France still has over 75,000 separate commercial grape-growing and winemaking entities might seem extravagant. And, according to those same basic laws of economics, they’d be right. A reduction in the number of routes to market should lead to a reduction in the number of products and producers. But it’s not that simple. At the turn of the century, the US had 7,000 major alcohol distributors; today there are around 500, but new wineries keep opening, edging the total up towards 11,000, to which has to be added over 1,000 professional grape growers. 

A major explanation for the way the US industry is defying those economic laws has been the extraordinary explosion of DTC (direct to consumer) sales. According to the latest Direct to Consumer report, 8.4m cases of wine were sold in this way in 2020, at an average price per bottle of $36.83. In value terms, DTC now represents just over 10% of all retail sales of domestically produced wine. These figures reflected the impact of Covid-19, with a growth in direct sales of 27%, but a fall in the average bottle price, from $40.70. Even so, the trend over the long term is clear.

In France, despite anecdotal accounts of Frenchmen and women queuing to fill their flagons at the local cooperative and stocking up at little wineries, only 5% of the home-consumption proportion of each year’s harvest is sold directly - at prices far lower than those enjoyed by wineries on the other side of the Atlantic. By contrast, around 88% is bought in supermarkets, discounters and convenience stores.

Given the almost inevitable impact of Covid-19 on restaurant sales, life is unlikely to become any easier for France’s independent producers. If they want to survive, they will need to follow the example of their counterparts on the other side of the Atlantic and develop more profitable relationships with consumers. That means not only selling more wine directly, but also persuading their customers to pay higher prices for it.

And if they do this, there might just be an additional benefit; maybe their survival and the activity they create in their communities could give the kiss of life to some of those cafes and boulangeries.