“A wake-up call”: French wine and spirits exports decline amid economic headwinds

The French wine and spirits sector witnessed a notable decline in exports in 2023, with figures falling 5.9% to €16.2 billion admist global economic challenges, prompting the President of FEVS to call it “a wake-up call” for French wine and spirits companies.

This decline as revealed by the Federation of Exporters of Wines & Spirits of France (FEVS), though marking the second-best performance on record, comes as high inflation and declining disposable income worldwide have notably impacted consumer spending habits, leading to reduced demand for luxury goods, including premium wines and spirits.

The US, a key market for French exports, experienced a sharp 22% decline to €3.6 billion, attributed largely to a correction in wholesaler inventory levels after the pandemic’s surge in purchases.

However, the performance in the United Kingdom and Asia offered a more nuanced picture. In the UK, exports held steady at €1.7 billion, marking a modest 1% increase from the previous year. The sales of sparkling and still wines remained largely unchanged, though volumes saw a 5% decline. Spirits exports to the UK were stable, with a slight 2% increase in value and a minor 1% decrease in volume.

Asia’s exports stood at €4 billion, also up by 1%. The region presented a mixed landscape, with Japan experiencing a 4% decline, while South Korea and Taiwan’s exports remained stable.

China’s market was particularly contrasted, showing a dynamic 3% increase in spirits exports, driven largely by Cognac, against a 20% decrease in wine exports, mirroring a broader 21% decline in Chinese wine imports. China’s ongoing anti-dumping investigation into Cognac and brandy is expected to dent future French cognac exports to the market.

Emerging markets such as Malaysia and the Philippines showed significant growth, with increases of 20% and 74%, respectively, although their overall contribution to French exports remains modest at €100 million combined.

“2023 remains marked by high inflation and a decline in consumption, linked in particular to the decrease of disposable incomes” said Gabriel Picard, President of the FEVS. “In this context, the reduction of overstocksin some markets – notably in the US – has resulted in a decrease of wine and spirits exports in volume.”

Highlighting the broader implications of these trends, Picard added: “This decline is a wake‐up call for exporting companies. It reminds us of the continued need to adapt to changing consumer and market demands. It also demonstrates how much the sustainability of the exportsuccess of wines and spiritsrequires a strong and long‐lasting support of the public authorities: new markets must be opened, and others must also be prevented from closing, in particular through trade retaliatory measures.”

Worldwide sales of French spirits decreased by 12% to €4.8 billion, with volumes down to 48.4 million cases (‐13%). That of wines reached €11.3 billion (‐3%), to 122.6 million cases (‐9.4%).