There has been a decrease in wine demand due to the growing popularity of craft beer.
The French government has allocated 200 Million Euros (Rs 17,82,29,92,656) to destroy surplus wine in an attempt to support struggling producers, BBC reported. The decision comes at a time when the wine industry is facing several challenges, including a decrease in wine demand due to the growing popularity of craft beer. Further, factors like the cost of living crisis, after-effects of COVID-19, and overproduction have also added to the problem.
Major wine-producing regions including Bordeaux and Languedoc are struggling to meet the expenses due to the fall in demand.
''We're producing too much, and the sale price is below the production price, so we're losing money,'' said Jean-Philippe Granier, from the Languedoc Wine Producers' Association.
As per AFP, recent rises in the prices of food and fuel, linked to rocketing global energy prices and the Russian invasion of Ukraine, have also seen buyers reduce their spending on non-essential goods such as wine.
Most of the allocated money will be used to buy excess stock, and the alcohol from destroyed wine can be sold to companies for use in items like cleansing products, hand sanitisers, perfumes, and so on. The funding will also be available for winegrowers to transition to alternative products, such as cultivating olives.
The money was ''aimed at stopping prices collapsing and so that winemakers can find sources of revenue again''. However, Agriculture Minister Marc Fesneau stressed that the industry needed to ''look to the future, think about consumer changes ... and adapt.''
Statistics from the European Commission this year till June reveal that wine consumption has fallen 7 percent in Italy, 10 percent in Spain, 15 percent in France, 22 percent in Germany, and 34 percent in Portugal.