Champagne has been in the news recently, with 2020 harvest limits reduced due to sales being hit hard by Covid-19. How exactly is Champagne’s yield regulation supposed to work, and is it doing its job? 

Each year, both sides of the Champagne table – growers and grape buyers – must agree the appellation’s yield limit. This is not a question of how many grapes can be picked off the vines, as is sometimes implied. Instead, the region takes a look at sales forecasts and decides how much of the harvest will be: 

Given the go-ahead to become champagne immediately

    • This year, Houses will be given the AOC (have authorised for use as champagne) 7,000kg per hectare immediately, whilst grower-producers will be given 8,000 kg. If sales figures reach 202 million bottles this year, then Houses will be authorised to use a further 1000 kg per hectare. If these sales are not met, then this 1000kg will be authorised as part of the 2021 yield. Given that the average over the last decade has been 13,500 kg, this represents a large drop in income for growers.
    • The Houses, however, are cautious about tying up yet more cash paying for more grapes than they need. Stock levels are forecast to approach 7 year’s worth of sales thanks to the stalling of the market in 2020.

Kept aside and allowed to become champagne in the future

    • Some consolation would ordinarily come from the ability to produce wine above 2020’s 8000 kg/year limit and place that wine in the Réserve Individuelle. This is the centrally-regulated reserve holdings of each producer, designed to absorb fluctuations in annual production.
    • In 2020 up to 7000kg per hectare could be added to the R.I. Most will be unable to keep this amount – no producer can hold more than 8000 kg per hectare’s worth of wine as a running total, and the average level across the region is already approaching this.
    • R.I. wines are not awarded the appellation until authorised for use. Producers can choose to jettison poor parts of their reserve and replace them with reserve from better harvests.
    • Yield agreements may dictate use of a certain amount of R.I. – for instance in 2018 the agreed yield of 10,800 kg per hectare comprised 500kg from the R.I., so only 10,300kg of 2018 grapes were actually authorised. If 2021 is low-yielding or disease-affected, producers will welcome having high-quality wine from good harvests in their R.I. to use.

Vinified but remain as ‘Vin Ordinaire’, probably destined for distillation

    • Any wine not awarded the AOC is kept as Vin Ordinaire. That which lies outside of a producers R.I. is sent to distillation the winter following harvest. In 2018, for example, disease-affected wine from the 2017 vintage that remained in the R.I. could be replaced with better 2018 wine and sent for distillation in the place of the excess 2018 production. 
    • Grapes, then, should not be left to rot on the vines as is sometimes reported. If you see grapes on the vines in Champagne long after harvest, it is more likely to be a ‘second crop’ of unripe grapes produced from secondary shoots.
Will any of these grapes really end up as Champagne hand sanitiser in 2021/22?

What Next?

In the end, the agreement is unlikely to either stem the flow of champagne quickly enough to protect prices or prevent large, potentially transformative losses amongst growers. Many growers believe that the UMC (the association of Houses) wants to drive down yields in order to force growers out of business and buy up land. Cash-strapped producers may struggle too, though, and it seems likely that some names will not survive the crisis. 

Whilst Champagne does manage supply to protect its pricing, there is a limit to how much be done under French and EU law. If the volume of stock becomes overwhelming for some, sell-offs are inevitable. Some of these may be sur lattes, where un-branded, un-disgorged bottles are sold on to be marketed by others. Temporarily suspended during the first few months of Covid-19, this could see a rush of lower-priced wines arrive on the market as producers dump stock under the table to raise cash. 

This crisis and the divisions it has reinforced will rumble on into next year, even in the event of a remarkable recovery in 2021. With reserves full and stocks rising, next year’s yield agreement could prove equally contentious. 


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