CHAMPAGNE BULLETIN JANUARY 2023

Welcome to the first Champagne Bulletin of 2023.

It probably won’t come as any surprise that January has been a relatively quiet month in Champagne, but nevertheless they are a couple of stories that have attracted considerable attention.

Rules and Regulations

Those of you have already had a discussion with me about your champagne brand project will have heard me say that the rules and regulations surrounding champagne are much more strict than you might imagine.

For example, you can’t add any flavourings or colourings to champagne and that’s just one of many rules that have to be adhered to during grape growing, wine making and labelling. If they are not, then the wine cannot be called champagne, but there are sometimes more severe penalties as one unfortunate (or perhaps it would be more accurate to say, unwise) champagne maker found out recently to his extreme detriment.

Frederic Gallois and his family have been tending vines and making champagne for many generations in a village in one of the more remote parts of the Champagne region. Perhaps M. Gallois thought that his out-of-the-way location would mean that he would be safe from the occasional inspection by the authorities. If so, he has recently been proved very wrong.

The suspicions of the authorities were aroused when it came to light that M. Gallois was harvesting grapes in his vineyards outside the dates that are officially permitted each year. This, in itself, could well have incurred a penalty, but things soon became worse – a lot worse

On closer inspection, it was found that some of M. Gallois’s vines were producing more than the permitted yield. It was then discovered that some of M. Gallois vineyards had been planted with varieties that are not permitted in the AOC Champagne. (Appellation d’Origine Controllée)

So M. Gallois faced charges on at least three counts:

Harvesting outside the officially designated dates

Planting grapes varieties not permitted in Champagne which led automatically to a third charge of

Producing and selling wine that did not confirm to the rules of champagne and deceptively passing off this product to consumers as genuine champagne.

The severity with which the authorities view this sort of breach of the rules is reflected in the penalty imposed. The fine of €12,000 was relatively minor; a far more ruinous punishment was the confiscation of some 100,000 bottles from the cellars of M Gallois. These bottles had a reported value of some 2 million euros.

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A shift in market dynamics

In other news, Kylie Minogue, whose range of still wines and Prosecco is enjoying spectacular success, has suggested that she would be interested in launching a champagne brand., however this may be easier said than done, in the short term at least, due to the constraints in supply at the moment.

You will have read in recent bulletins that supplies of champagne are extremely tight at the moment. In consequence all champagne makers are wary of taking on new clients and new projects.

The dynamics of the market have shifted significantly over the past two or three years and we have gone from a situation in which champagne houses were keen to accept new clients to the opposite situation in which new clients need to put forward a proposal that offers real benefits to the champagne maker apart from just more volume. This could be the chance to enter markets in which the champagne maker is not currently represented, the chance to reach a new type of consumer, or the chance to be associated with a high-profile personality whose image fits the champagne house’s marketing objectives.

In Kylie Minoghue’s case this should not be a problem, but even so the quantity of bottles available may be somewhat limited for the next year or two until the wines from the 2022 harvest start to become available for sale.

Champagne shipments in 2022

  To put the demand /  supply situation into clearer focus, it has just been announced that the total number of bottles shipped in 2022 ( to France and to export markets) reached 326 million bottles. That’s the second highest figure ever behind only the 338 million bottles shipped in 2007.

In terms of value, the record so far was achieved in 2021 when the total value of shipments was 5.7 billion euros. The precise figure for 2022 has not yet been released but in all likelihood, it will exceed 6 billion euros for the first time

Premiumisation is the name of the game

The combination of strong demand for champagne and the limited supply makes for a classic Sellers’ Market and the prospect of significant profits to be made. This has not escaped the attention of many of the largest names in the world of wine.

In a move that underlines the interest in Champagne shown by major international drinks companies over the past three or four years, Artemis Domaines, a group controlled by the Pinault family which also owns prestige brands from Bordeaux, Burgundy, Napa Valley, has acquired Champagne Jacquesson, a highly respected and mid-sized producer based in Dizy. This adds to the associated Artemis Domaines already enjoys with Champagne Henriot.

This is yet another piece of evidence that demonstrates the shift, over the past few years, towards the ‘premiumisation’ of champagne which one imagines will lead to higher prices for brands that succeed in creating a premium image and, one only can assume, greater profits for the owners of those brands.

Method in my madness (to C or not to c?)

Finally, some of you may be wondering why I sometimes spell Champagne with a capital ‘C’ and sometimes with a lower case ‘c’. My choice of spelling may seem random but there is some logic to it, at least in my eyes.

Always spelling Champagne with a capital ‘C’ does not take into account the fact that there are two separate ways of referring to the word in French: La champagne means the geographic region of Champagne, whilst Le champagne refers to the sparkling wine made in Champagne.

Since Le and La are not used in English, the only way I can find of differentiating between the two uses of the word is to use a capital ‘C’ for the region and a small ‘c’ for the wine.

I hope this explanation lends some method to my madness, but I am certainly not saying that my method is correct. Feel free to do whatever you want.

Until next month...