TOO MUCH EUROPEAN WINE?
BG sent me a link to a Los Angeles Times story about a wine surplus in Europe. Apparently newly emerging wine exporters such as Chile and Australia and even the United States are cutting into Europe's business. Many of these wines are cheaper. Earlier this year, thousands of winemakers in Southern France "took to the streets" to demand government help in the face of low demand and tough competition.
The article, which is a Reuters story, states that government subsidies of wine production have artifically increased supply beyond demand resulting in the surplus. The European Union Agriculture Commissioner, Mariann Fischer Boel, is proposing scrapping or simplifying the subsidies in order to reduce production. Apparently one of the largest subsidies (1.2 billion euros or $1.5 billion) is to convert the surplus wine into biofuel or industrial alcohol. It seems to me (without knowing all the facts) that this is a reasonable subsidy, and preferable to paying farmers to NOT grow crops. However, the proposal is to use the money instead to pay producers to dig up their vines in order to cut production. Also, under Europe's strict control over areas and varieties of grapes that can be grown, new vine plantings are currently prohibited until mid-2010. One proposal is to extend that to 2013 and possibly make it permanent.
The article indicates that a formal presentation of these proposals will be made later this year and that the main wine-producing countries of France, Spain and Italy (the top three producers in the world) will not take kindly to these ideas.
I, for one, gladly volunteer to help take some of that surplus off their hands!
The article, which is a Reuters story, states that government subsidies of wine production have artifically increased supply beyond demand resulting in the surplus. The European Union Agriculture Commissioner, Mariann Fischer Boel, is proposing scrapping or simplifying the subsidies in order to reduce production. Apparently one of the largest subsidies (1.2 billion euros or $1.5 billion) is to convert the surplus wine into biofuel or industrial alcohol. It seems to me (without knowing all the facts) that this is a reasonable subsidy, and preferable to paying farmers to NOT grow crops. However, the proposal is to use the money instead to pay producers to dig up their vines in order to cut production. Also, under Europe's strict control over areas and varieties of grapes that can be grown, new vine plantings are currently prohibited until mid-2010. One proposal is to extend that to 2013 and possibly make it permanent.
The article indicates that a formal presentation of these proposals will be made later this year and that the main wine-producing countries of France, Spain and Italy (the top three producers in the world) will not take kindly to these ideas.
I, for one, gladly volunteer to help take some of that surplus off their hands!
posted by Gino at
9:11 PM
1 Comments:
Saluto Gino!
Some of the finest restaurants in the Boston area are touting the Chilean and Australian wines, topping the wine lists in the manner of a coup, thereby taking a sudden visible chunk out of the European exports. In my opinion, which is derived almost entirely from a naive first impression, the Chilean and Argentinian wines do not have the integrity of the Italian, French, Spanish, or US wines. Last year I insulted a sommelier for refusing his choice, which was Chilean. I think those of us who enjoy wine with delicious meals begin to recognize wines that are etheric v. wines that are digestive. I dislike the enzymes that the Chilean and Argentinian wines draw from my body.
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Anonymous, at July 12, 2006 2:36 PM
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