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May 30, 2022 View:

French government provides €80 million in financial support for winegrowers

French Prime Minister Castell visited the central region of France on August 5 and pledged nearly 80 million euros in additional financial support for the winegrowing industry to mitigate the impact of the epidemic and economic crisis on the sector.

Image from: European Times

Total over 200 million

According to AFP, Castet, accompanied by Agriculture Minister Julien Denormandie, inspected vineyards in Menetou-Salon and Sancerre in the Cher department.

In May this year, the French government has provided 170 million euros in financial support for the winegrowing industry, this time an additional 76 million euros, a total of 246 million euros.

New crown outbreak hits

During his visit, Castet heard complaints from growers, who said that cafes, bars and restaurants had all closed during the previous quarantine, that related tourism remained sparse after the restart, and that trade had shrunk significantly. Overall, vineyard owners believe the outbreak has led to an expected loss of at least 1.5 billion euros in revenue for the industry due to the shutdown of restaurants, festivals and tourism. Castell said he has asked for the relevant subsidies to be released as soon as possible.

U.S. Tariff Increase

In addition to the new crown epidemic, the announcement by the United States at the end of 2019 of tariffs on wines exported to France below 14 degrees as a penalty due to the commercial dispute between Airbus and Boeing has already unnerved French winegrowers. Prior to Castet"s visit to Menetou-Salon, some local vineyard owners complained that they felt French growers had been abandoned by the government over the Trump tax.

Jrome Despey, general secretary of the French National Federation of Agricultural Operators' Unions (FNSEA), said that the additional subsidies for Castet were a relief for the winegrowers.

But Despée said he regretted that the latest announcement of 246 million euros included funding from the EU's revitalization program. Industry sources believe that the French winegrowing industry needs 350 million euros to get out of the crisis by adding up the subsidies from the country and the EU.

Of the 246 million euros, 119 million is a state-guaranteed loan and 127 million comes from the EU's viticulture budget, Despe said.

Of the additional funds newly announced by the French Prime Minister, the main ones are used to help distill alcohol (56 million euros) and excess alcohol storage (20 million euros). The former is aimed at purifying unsold wine into alcohol that can be used to make bioethanol, perfume or alcoholic hand sanitizer. According to Agriculture Minister De Normanti, the work involves about 260 million liters of wine. Growers, on the other hand, claim that only 300-350 million liters of wine will be disposed of to make room for this year's harvest.

In some areas of Southern France, the grape harvest season has already begun. In Menetou-Salon, in central France, the harvest is expected to start at the end of August, three weeks earlier than in previous years.