French wine sales hurt by China slowdown

World demand for France's famous Bordeaux wines have dropped nearly 10 percent due in large part to a disappearing thirst in China and Hong Kong, which are dealing with economic slow downs.

French wine sales hurt by China slowdown
France's wine sales are hurting due to a softening economy in China and Hong Kong. Photo: AFP

A dramatic decline in demand from China and Hong Kong has dried up sales of France's famous Bordeaux wine, data from the professional association published on Tuesday showed.

At the end of July 2014, overall sales of Bordeaux wine for export stood at 2.17 million hectolitres (roughly 271 million standard bottles), an eight-percent drop.

This resulted in an 18-percent decline in turnover, according to the CIVB association of Bordeaux wine professionals, to €1.81 billion ($2.3 billion).

"China is going through an economic slowdown and has reduced its trade with the rest of the world," complained Bernard Farges, CIVB president.

However, he said the disappointing figures were "not a surprise" given the poor 2013 harvest.

China and Hong Kong led the declines. China saw an annual decline of 25 percent in terms of volume and 26 percent turnover. Sales to Hong Kong were down nine percent in volume and seven percent in cash terms.

Farges noted that the Chinese market had gone from 10,000 hectolitres in 2005 to 392,000 now, so it needed a "breather".

The French wine industry has recently blamed an anti-corruption crackdown and frugality drive in China for a collapse in sales.

The European market was also down three percent at the end of July compared to last year, CIVB said.

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Cold snap ‘could slash French wine harvest by 30 percent’

A rare cold snap that froze vineyards across much of France this month could see harvest yields drop by around a third this year, France's national agriculture observatory said on Thursday.

Cold snap 'could slash French wine harvest by 30 percent'
A winemaker checks whether there is life in the buds of his vineyard in Le Landreau, near Nantes in western France, on April 12th, following several nights of frost. Photo: Sebastien SALOM-GOMIS / AFP

Winemakers were forced to light fires and candles among their vines as nighttime temperatures plunged after weeks of unseasonably warm weather that had spurred early budding.

Scores of vulnerable fruit and vegetable orchards were also hit in what Agriculture Minister Julien Denormandie called “probably the greatest agricultural catastrophe of the beginning of the 21st century.”

IN PICTURES: French vineyards ablaze in bid to ward off frosts

The government has promised more than €1 billion in aid for destroyed grapes and other crops.

Based on reported losses so far, the damage could result in up to 15 million fewer hectolitres of wine, a drop of 28 to 30 percent from the average yields over the past five years, the FranceAgriMer agency said.

That would represent €1.5 to €2 billion of lost revenue for the sector, Ygor Gibelind, head of the agency’s wine division, said by videoconference.

It would also roughly coincide with the tally from France’s FNSEA agriculture union.

Prime Minister Jean Castex vowed during a visit to damaged fields in southern France last Saturday that the emergency aid would be made available in the coming days to help farmers cope with the “exceptional situation.”

READ ALSO: ‘We’ve lost at least 70,000 bottles’ – French winemakers count the cost of late frosts