Bursting Champagne’s Bubble
By Michael Gregson
At more than US$50 a bottle, Champagne is beyond most Sri Lankans’ pockets – though you might find it at a fancy reception or hotel. The Colombo Jazz festival used to boast a Champagne bar and there was always a long queue of thirsty drinkers with bulging wallets.
It’s been the preserve of high-end weddings, parties and celebrations. Racing drivers have sprayed it liberally from podiums. But thanks to COVID-19, Champagne’s bubble has burst. The French fizzy wine business is going flat broke.
“We are in a crisis,” says Vitalie Taittinger, the president of the prestigious Taittinger Champagne house based in Reims. “This has been hard: the virus has really hit us. But we are facing other challenges too, from climate change to a new generation with different tastes. This is a period of transition.”
Champagne is one of France’s biggest exports, but sales have plummeted as bars and restaurants closed. All the events that usually involve Champagne – weddings, parties and other celebrations – have been scrapped because of COVID-19. Worldwide, sales this year could fall by a third to about US$4 billion, compared with a record €5.92 billion in 2019. By next year, unsold stocks could swell to four years’ supply – or more than 1.4 billion bottles.
“We are experiencing a crisis that we evaluate to be even worse than the Great Depression,” said Thibaut Le Mailloux, of the Champagne Committee, which represents the region’s growers.
Champagne regularly takes a hit during an economic crisis as the wealthy cut back conspicuous spending to try not to appear out of touch with the less well off. Cheaper Italian Prosecco sales have been stable, though in Spain there has been a drop in demand for cava.
In response, French champagne producers have decided to put a cap on the amount of grapes they send for processing into wine.
They took the decision because a glut of the drink in cellars and on wholesalers’ shelves would drive down prices and tarnish the aura of luxury and exclusivity that the industry has spent years building up.
But the cap – limiting the amount of grapes that can be harvested from a hectare to 8,000 kg – means that anything over that figure must be left to rot.
The quota is one fifth less than last year’s harvest and this year, because of hot sunny weather that growers ascribe to climate change, the yield in many vineyards is even more bountiful than usual.
Some grapes could be turned into hand sanitiser, which one producer, Anselme Selosse of Jacques Selosse Champagnes, called “an insult to nature”.
Champagne – the region and the wine – faced challenges even before the pandemic spread across the globe earlier this year.
They include the uncertainty over trade tariffs after Brexit – the UK is champagne’s biggest single export market and will leave the EU single market in January – as well as the threat of climate change. This year, the grape harvest began in some Champagne villages on 17 August, the earliest date in the 300-year history of the sparkling wine.
The US is the second-biggest export market (16 per cent), and President Donald Trump has threatened to slap tariffs on Champagne. There are also changing consumer habits: young people are drinking less alcohol and there is growing competition from Prosecco and other cheaper sparkling wines. Given the quality of this year’s Champagne harvest, the decision to leave many grapes rotting in the vineyard was especially hard. The growers say there has been little disease in 2020, and the fine weather has produced grapes with the right levels of sugar and acidity that could make for a vintage year.
Champagne’s fortunes will continue to depend on the pandemic. Half the sales are usually made in the last four months of the year that includes Thanksgiving, Christmas and New Year.
In Reims, Vitalie Taittinger says this is a teaching moment for Champagne. “Sometimes we need a crisis to regenerate,” she says. “We have to renew ourselves, shed our skin. We have to innovate, make our Champagne fizz and surprise, and put more emotion into the bottle.”
But the bubbles will be back, sooner rather than later, Ms Taittinger promises. “Champagne remains an extraordinary wine,” she says. “Even if life is rotten, we don’t have to have to be sad. And Champagne creates happiness.”
If you can afford it.