CHAMPAGNE BULLETIN JULY 2021
You might think that with July and August being the two months when many people in France take a summer holiday, that things would be quite quiet here in Champagne, but in fact the opposite is the case. There is plenty to tell you about this month
There’s great news for anyone considering creating their own champagne brand, particularly in the USA
According to Impact Databank, one of the most respected journals for the wines and spirits trade, shipments of champagne to the USA jumped 48% in the first four months of 2021 versus 2020.
Of course, this increase has to be seen in context: champagne shipments slumped in 2020 for obvious reasons and so an increase this year was only to be expected. However, the USA fared better than most other markets throughout last year and continues to lead the way this year.
The overall decrease in champagne shipments last year was -18% but shipments to the USA fell by only 2.5% (again according to Impact Databank).
Seen against this background, this year’s increase in shipments of 48% is all the more impressive.
What’s more, data from Nielsen, a company which tracks sales in supermarkets and many other off-trade venues, shows that purchases of champagne were up 60% in the first four months of the year and sales of rosé champagne were even more bouyant at +66% versus 2019.
Not surprisingly, the big brands such as Moët & Chandon and Veuve Clicquot account for the majority of the sales and this is unlikely to change any time soon, if ever, but as they say: “A rising tide floats all boats.”
Back in Champagne
Over the past few weeks, several of the big champagne houses have been announcing their half-year results and it’s been good news all round. Not surprisingly, results across the board have shown big increases versus last year – not difficult when sales last year were so dreadful – and some houses have posted increases even versus 2019
What struck me however was a short sentence in the results of the BCC Lanson group which owns brands such as Lanson, Boizel, De Venoge, Philipponnat and 4 others.
First half turnover was up 33.7% versus 2019 but readers of the report were reminded that in Champagne typically only one third of annual sales are made in the first half year and that this is sufficient to cover just half of the annual fixed costs.
That implies that a full two thirds of annual sales are needed to cover fixed costs; put another way, a typical champagne house doesn’t start making a profit until October of each year.
It’s an interesting thought that really underlines the crucial importance of the final quarter of the year for champagne sales.
In The Vineyards
You may remember that in last month’s bulletin I lamented the poor weather we are having this year. I wish that I could say that things have been hotting up in the vineyards too but in fact nothing much has changed: temperatures are still below average and have been for several weeks now.
We’ve had little sunshine; instead we’ve had grey skies, heavy rain and regular thunder storms.
When the sun does come out for a day or two it is really warm, but after the heavy rain, this produces the perfect humid conditions for mildew, and another vine disease called oïdium, to proliferate.
All in all, unless we have almost uninterrupted sunshine for the next couple of months, 2021 doesn’t look like it will be a great vintage.
I mentioned in last month’s bulletin the old adage that “année en 1, année de rien” which means roughly, “years that end in 1 are good for nothing” and this is looking more and more likely to be true this year.
Those past generations of champagne makers knew a thing or two about the weather and growing grapes despite their lack of fancy technology.
Fortunately, there is no reason to worry that the quantity or quality of this year’s harvest will have too damaging effect on the champagne that is produced because Champagne has its wonderful system of Individual Reserves – wine put aside in previous years - that can be called upon in exactly the sort of circumstances that we face this year. However, that’s a topic to be explored in a future bulletin.
From Russia, but not with love
This month’s blockbuster story has come from Russia and has caused something of a sensation in Champagne.
At the beginning of this month Russia announced a change in their law regarding the labelling of champagne. The new law says that wine from Champagne no longer has the right to put the term champagne in Cyrillic script on the back labels. Instead, bottles of champagne must use the word sparkling wine, in Cyrillic script on the back label.
What’s more and what’s even more galling to the champenois, is that the new law states that only makers of sparkling wine in Russia will be able to use the word champagne, again in Cyrillic script, on the back labels of their bottles.
The word Champagne in Latin script may still be used on the front label of a bottle of champagne, but in the view of the authorities here, that is of no significance. They are up in arms and passionately feel that this new law is simply not acceptable. In fact it seems to be the exact reverse of the situation previously when the word champagne in any language was seen as a protected term to be used only for sparkling wine made in the Champagne region of France – a long standing convention agreed to and practiced by the governments of most countries in the world.
To say this has caused outrage in Champagne would be an understatement. Appeals have been made to officials at the highest levels of French and European Union governments to intervene in this affair and in the meantime the Comité Champagne has told all champagne houses to cease shipments to Russia until further orders.
The outcome is as yet unclear, but I suppose one can say that if there is a lack of heat in the vineyards, there’s a lot of heat being generating around the negotiating tables.
Nature continues its course in the vineyards and the grapes are growing slowly, but steadily.
It will be a few weeks yet before the Pinot Noir and the Meunier start to turn colour and at this stage of the year all the grapes, be they black or white, look much the same.
Fingers crossed for some more sunshine to make sure the grapes are good and ripe come September.