Comité tries to predict demand in difficult market

Yield for 2019 harvest set at 10,200kgs/ha

Champagne producers agreed to set the maximum yield level for the 2019 harvest at 10,200kilos per hectare, 600kgs/ha down on the base level of 10,800kgs/ha originally* announced for the 2018 harvest. If this level of yield is achieved in 2019, it will produce around 300m bottles. The CIVC Comité that represents the two sides of the champagne business — the (grape) growers and the merchant houses (négociants) – see this as the appropriate level to provide a suitable supply of champagne to meet future predicted demand. Or as the Comité put it: “This volume ensures a supply consistent with the needs of operators and maintains a balanced stock level for the sector.”

When they make this decision on the yield level in late July, with the harvest start typically six to eight weeks away, as well as considering the approaching harvest’s potential in terms of quality, health and size, plus the level of stocks and reserves currently held by producers, they look at current and future worldwide demand for champagne. It’s this last element that’s the trickiest; predicting demand. With issues at home, French domestic sales still account for nearly half of all champagne consumed (48.7% or 147.1m bottles in 2018) and in the two major export markets, the UK which is the largest by volume and the USA, the most valuable, this decision was particularly difficult this time.

As the Comité commented in its 24 July statement: “In the first half of the year [2019], Champagne sales increased further thanks to exports. It [value] is close to 5 billion euros over 12 rolling months despite decreasing shipments pronounced on a French market affected, including the consequences of an increased legislative framework of promotions in supermarkets. The resumption of shipments to the UK is only related to the precautionary measures taken on the assumption of a hard Brexit. The dynamism of most third countries, subject to uncertainties on world trade, will probably not fully offset the decline in volumes on the French market.”

This statement needs some interpretation. Worldwide demand for champagne is currently flat with shipments down 1.5% to the end of May 2019, while the MAT year-end figure is predicted to be around the 300m bottle mark. In the French domestic market — where 48.7% of champagne was sold in 2018 by volume but only 41.7% by value – it appears that French legislation banning the sale of champagne at under cost is being more rigorously applied. This is accelerating the overall decline in sales in France.

Shipments to the UK, which went up in the first half year only did so because of producers and retailers stockpiling in advance of the previous Brexit deadline of 29 March. Something it was fairly easy and relatively risk-free to do as at that time, just after the important year-end sales peak, as warehouses were fairly empty. The Champenois don’t believe this is sign of the UK market recovering any time soon. The Comité statement doesn’t even mention anything about President Trump’s threat to impose increased import duties on French wine into the USA, which would also be likely to have a negative impact on sales there.

What the important last quarter of 2019 will bring in terms of sales – it’s in these three months a disproportionately large percentage of champagne is purchased — is therefore very hard to predict. If there is an unexpected surge in sales, there is plenty of supply, however. Stocks are relatively high and after the bumper and high quality 2018 harvest, the average reserve held across the appellation sits at 7,750 kg/ha, very close to the maximum level of 8,000kgs/ha, and equivalent to around 230m bottles.
*While the yield for the 2018 was originally set at 10,800kgs/ha, partly because of its high quality, the Institut National de l’Origine et de la Qualité (INAO) later agreed to allow producers to add 4,700 kg/ha to the reserve (providing their reserves did not exceed the maximum of 8,000 kgs/ha) so producers could harvest up to 15,500kgs/ha.

Earliest harvest ever in Champagne but also a plentiful, ripe crop

While the official Champagne harvest dates announced last Saturday gave this Monday (20 August) as the start date for picking, not Tuesday as has been widely reported, in fact picking began in the Grand Cru of Ambonnay last Friday, 17 August, making it the earliest harvest in Champagne on record.

By the process known as derogation, producers can apply to the local INAO office to start picking earlier than the official start date Continue reading “Earliest harvest ever in Champagne but also a plentiful, ripe crop”

Yields for 2018 harvest set at 10,800kgs/ha as Comité predicts growth over next few years

Champagne producers have just agreed to set the maximum yield level for the 2018 harvest at 10,800kilos per hectare. This is the same level as was agreed for the previous harvest in 2017, though that included 500kgs/ha to be released from the reserve, so it was effectively 10,300kgs/ha. After severe April frosts in 2017 and then major problems with rot just before picking began in late August the average yield for the 2017 reached 10,057 kg/ha, according to the provisional figure released by the Champagne Comité.

Picking grapes in Verzenay

So far, the 2018 growing season has been Continue reading “Yields for 2018 harvest set at 10,800kgs/ha as Comité predicts growth over next few years”

Champagne shipments rise fractionally only

Champagne shipments has risen very slightly compared to the 306.096 bottles reached in 2016, rising by 0.52% or around 1.6m bottles to 307.7m bottles in 2017. At the end of November 2017 shipments were in line to rise to around 311m bottles and even the Union des Maisons de Champagne (UMC) was predicting 310m bottles. But sales in December, usually the busiest month in the year, fell back generally by around 10%, on the same month in 2016.

The news follows a difficult harvest in 2017, when the general quality, particularly of the Continue reading “Champagne shipments rise fractionally only”

Yields for the 2017 harvest set at same level as 2016

The Comité Champagne has announced yields for the 2017 harvest are set at 10,800kgs/hectare, including 500kgs/ha to be released from the reserve. Despite spring frosts hitting the vineyards after warm weather triggered Continue reading “Yields for the 2017 harvest set at same level as 2016”

Sunshine & heat also hit crop in Champagne as picking starts

Grapes on the north side of rows haven't suffered
Grapes on the north side of rows haven’t suffered

Last month we reported that the harvest in Champagne was likely to be well down on the maximum yield set of 9,700 kilos per hectare, with some regions like the Côte des Bar, particularly badly hit. As picking begins in half a dozen crus today (12 September) – two villages one in the Aube and one in the Marne départements actually started picking black grapes on Saturday (10 September) — it seems that the average expected level of yield is no more than 7,000kgs/ha. And there are major differences between different areas of the appellation. In parts of the Aube/Haute-Marne, devastated by frosts, average yields are unlikely to be higher 4,000 kg/ha, whereas in some crus of the Montagne de Reims and the Côte des Blancs yields could reach as high as 10,000 kg/ha. Continue reading “Sunshine & heat also hit crop in Champagne as picking starts”

2016 Champagne harvest yield set to produce around 315m bottles

The yield for the 2016 harvest, currently expected to begin around mid-September, has been set at 9,700 kilos per hectare with a further 1,100kgs/ha to be taken from the reserve at the start of February next year. This level of yield will potentially produce around 283m bottles with a further 32m bottles coming from the reserve next February, if appropriate, making a total production of 315m bottles. This compares with worldwide champagne shipments of 312.5m in 2015 and the news that the MAT total for shipments in the 12 months to the end of June 2016 were up just over 2%.

The harvest is expected to start in mid-September
The harvest is expected to start in mid-September

However, after a very difficult growing season in Champagne so far this year with frosts, disease and uneven flowering all reducing the actual potential yield from the 2016 harvest, it seems likely Continue reading “2016 Champagne harvest yield set to produce around 315m bottles”