There are a lot of similarities that can be drawn from the current Champagne crisis to what Marlborough growers suffered last year. Will Champagne fair any better or will the price and equity of Champagne follow all other wine trends!
Usually at this time of year Champagne's Vignerons are rubbing their hands and smelling the cash that is coming in by the truck load. This year, however, they are trying to find a market for their grapes. Negociants, the Champagne makers that buy the grapes from the growers, have other ideas. Due to the demand, in recent years and growers having higher yields to fill the global desire for bubbles, producers could barely keep up with this trend.
All of a sudden the market collapsed and demand dried up, especially in the US and Britain which combined made up 40% of export orders. Last year 322 million bottles were sold, which dropped from it's peak in 2007 of 340 million bottles. This year the sales are likely to sit around the 270 million mark but with 1.2 billion bottles that remain unsold we are heading for a Champagne glut.
The price cuts have already started from the ground up. The negociants wanted to pay less for their grapes by approximately 50% but the growers refused and are blaming the negociants' for their ambitious forecasts of the Champagne market, although both parties realised that something must be done to end this impasse. then on the eve of harvest the governing body announced that they would buy the grapes for 9,700 kg/hectare but will only bottle 8,000 kg/hectare leaving a deficit of 1,700 kg/hectare.
Will this scenario solve the problem, I doubt it, will there be undercutting in Champagne, probably! It all goes to show that one should keep your eye on the ball and not become to hedonistic and have plans that do not include plan B.
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