French wine and spirits exports hit all-time high

FEB 10, 201610:04 PM

[PARIS] The value of French wine and spirits exports reached an all-time high last year, mainly helped by a weak euro, strong demand for champagne and cognac and a recovery in the Chinese market, but producers warned there was a further drop in volumes.

After two years of decreases, sales abroad of French wine and spirits rebounded to reach a record 11.7 billion euros (US$13.2 billion) in 2015, up 8.7 per cent from the previous year, the sector's export federation FEVS said on Wednesday.

The increase put the sector back in second place in the rankings for the largest export industries in France, behind aerospace and ahead of perfumes and cosmetics, with net exports totalling 10.4 billion euros and equivalent to the price of 126 Airbus aircraft, FEVS said.

"There is a clear advantage from the euro and low oil prices helped on further-away markets," said FEVS's chairman, Christophe Navarre, after a news conference.

He declined to give a forecast for 2016. "It's like the weather, you have to take it when it's good and adapt when it's bad," he said.

About 60 per cent of French wine and spirits exports are made outside the European Union.

The United States remained France's largest market, helped by growing demand for high-value products and the favourable exchange rate making euro-denominated wines more competitive.

The US market now accounts for 22 per cent of French wine and spirits exports at 2.6 billion euros, up more than 28 per cent in 2015.

French exports to Asia were boosted by a near 23 per cent rise in wine and spirits sales to China, where the market had been subdued by the clampdown on extravagant spending.

But the economic slowdown in China caused FEVS to remain cautious in its forecasts for sales in 2016.

Cognac was the main driver of the spirits sector, with a near 20 per cent jump in exports by value to 2.6 billion euros but lower vodka sales limited total growth for spirits exports to 13 per cent, to 3.7 billion euros.

The wine sector was buoyed by champagne exports which rose by 12 per cent by value in 2015 to 2.7 billion euros, bringing total wine exports to 7.9 billion euros, a rise of 6.7 per cent on 2014.

However, FEVS warned that overall, wine shipments fell 3.6 per cent by volume, due mainly to a drop in still wine supplies.

Navarre called the enduring drop in wine output "a real weakness" hurting France's market share abroad.

Over the past 15 years French wine's market share in international trade has been cut by nearly half by volume, FEVS said. By value it has been cut by a third.

REUTERS