A combination of economic slowdown and political crisis, coupled with the coronavirus pandemic has brought Bourgogne wine export to China and Hong Kong to its knees in the first nine months of the year, according to the latest data released by Bourgogne Wine Board (BIVB).
Export figures for Bourgogne wines show a sharp drop to mainland China and Hong Kong, which together account for about 10% of Bourgogne overall wine export value.
Exports were down 30.6% by volume and down 16.8% in terms of revenue from January to September, compared with the same period last year.
Exports to its other top markets such as the UK, Canada and Belgium however held strong and saw growth in value.
Explaining the decline, BIVB says, since the start of 2020, these two territories have been hit by the start of an economic slowdown, political crises, and the COVID-19 pandemic. However, it points out that China is one of the few countries expected to show growth for the full year in 2020 (up 2% according to the IMF, up 4.9% according to the Chinese authorities), having brought the pandemic under control.
Though overall exports were shaved off by the pandemic, some appellations and villages have seen remarkable growth to mainland China and Hong Kong, the association notes.
Village and Village Premier Cru AOCs from the Côte Chalonnaise were up 60% by volume and 20% in terms of revenue.
Chablis Premier and Grand Cru gained 5.9% by volume, while Village AOCs from the Grand Auxerrois (Saint-Bris, Vézelay) saw a sharp increase of 273 % by volume (under 10,000 bottles).
Red wine exports to the mainland market and Hong Kong were hampered further, as it accounts for majority of exports to the two regions. Red wines exports dropped by 39% compared to the first nine months of 2019. The Irancy AOC did show some spectacular growth of 145% in terms of revenue, but this was in relation to a very limited 11,000 bottles.
In general, in the first three quarters of the year, exports of Bourgogne wines were greatly impacted by lockdowns and restrictive measures in foreign markets (down 3.9% by volume compared to the first nine months of 2019). Despite this, the months of January and February, and June and July recorded growth by volume.
Uncertainties of the pandemic, Brexit and tax hike still loom large for two of its key markets, the UK and the US, going forward.
The US is continuing to impede imports of French wine through a 25% levy imposed as part of the Airbus/Boeing dispute, while the UK is redefining rules for imports and for trade with overseas markets after Brexit.
In France, Bourgogne wines held up well on retail circuits (up 4.8% by volume compared to the first eight months of 2019), notably thanks to strong sales in local stores and click-and-collect.