The European Union has allocated €40 million (US$46.4 million) to support French wine producers through a temporary crisis distillation scheme aimed at stabilising prices amid falling consumption and declining exports.
The funding will help remove up to 1.2 million hectolitres of surplus red and rosé wine from the market. Under an EU regulation dated March 31, winemakers and cooperatives will receive €33 per hectolitre to distil excess wine into alcohol for industrial uses, including disinfectants, pharmaceuticals and energy production.
The measure is designed to ease mounting stock pressure in key wine-producing regions, particularly for red and rosé wines, following several years of overlapping crises and a broader structural decline in both domestic consumption and export demand.
Across the bloc, more than 3.5 million hectolitres of red and rosé wines have already been withdrawn from the market in six producing countries – Germany, Spain, France, Italy, Hungary and Portugal – with France accounting for around 77% of the total volume.
In France, prices for red and rosé wines have been under sustained pressure as demand weakens at home and abroad. Retail sales of these wines fell 8% between January and November 2025 compared with the average over the previous three years.
Exports have also continued to decline following a brief rebound in 2021 after the pandemic. In 2025, French export volumes of red and rosé wines dropped 5.2% year-on-year and were down 12% compared with the four-year average.
French producers are also contending with shifting consumer preferences, the effects of climate change, geopolitical trade disruptions and falling bulk wine prices, according to the EU.
Although production is estimated to be 16% below long-term averages, supply continues to outpace demand, intensifying pressure on the market and prompting intervention measures such as crisis distillation.
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