News Digest January 2024

by Valeria Tenison

A busy month of wine news, starting off with the growth of no and low wine in Bordeaux – even if it can’t be bottled under that name.

A significant milestone in the Bordeaux wine landscape comes with the first alcohol-free wine made by a Saint-Émilion Grand Cru estate, Zero by Edmus. Produced by Laurent David, whose background is in the tech industry and has investors in his estate that were found through a crowd-funding campaign, this wine is made using a slow reverse osmosis process which gently removes alcohol. Though the 1.6ha Château Edmus is certified organic, the 1,200 bottles of this new wine have no organic label, and are not bottled under AOC St Emilion due to legal constraints, because the legislation of this style of wine has yet to be codified.

Beyond individual winemakers, Bordeaux Families, a cooperative in Sauveterre de Guyenne (Entre-deux-Mers) with 300 members, is diversifying its portfolio to include non-alcoholic and low-alcohol options. Bordeaux Families has invested €2.5 million in vacuum-distillation equipment, which can partially or fully de-alcoholise 250hl of wine daily. The No-Low portfolio currently includes IGP-level Les voiles de l’Atlantique (9%ABV) and fully de-alcoholised, wine-based flavoured drink under the Sauveterre brand.

Also in St Emilion, the protracted legal battle over the sale of Château Beauséjour Duffau-Lagarosse continues. This 6.75ha vineyard was purchased by the Courtin family for €72 million in April 2021. One of the failed bidders, the Cuvelier family, continues to challenge the outcome, and has been back in court this month.

The legal saga originates from the Société d’Aménagement Foncier et d’Établissement Rural (SAFER)’s April 7, 2021, decision, favouring the Courtin family as purchasers, with Joséphine Duffau-Lagarrosse – a young winemaker, and member of the original family owners – as estate manager. The Cuveliers, initially selected as buyers on November 4, 2020, challenged SAFER’s decision in court. There are now multiple arguments over notification dates and SAFER’s alleged lack of transparency, and its departure from originally-approved terms over the sale. The defence representing Beauséjour Courtin counters the Cuveliers’ claims, portraying them as a larger entity attempting to add another Grand Cru Classé to their holdings for fiscal optimisation. As the court deliberates, the outcome on February 29 will likely influence similar transactions in the future, raising questions about the role and responsibilities of rural development bodies in high-stakes deals.

More court battles, with the fight between a Médoc producer and two merchant houses continues this month, with a decision due in February. Rémi Lacombe, a wine producer in Médoc, last year launched legal action against two Bordeaux wine merchants for allegedly purchasing bulk wine at excessively low prices. The case, which represents uncharted territory for the Tribunal de Commerce de Bordeaux, revolves around Article 442-7 of the Commercial Code, a provision of the Egalim law enacted in 2019. The law holds the buyer responsible for ensuring that the sale of agricultural products or food items offers a fair deal for the producer. Lacombe’s company, Société Civile Fermière Rémi Lacombe, is suing two wine merchants – Ginestet and Excell (a Cordier subsidiary, part of the Invivo group) – for ten purchase contracts in 2021 and 2022, alleging that the average price of bulk wine was €1,200 per tonneau (900l), whereas the estimated production cost for the property was €1,600.

Given the absence of legal precedent and the potential for economic retaliation, Lacombe’s lawyer argues that the court should set an example in line with the spirit of the Egalim law. The plaintiff contends that the law’s objective is to rebalance power dynamics between producers, who are often fragmented and vulnerable, and large distributors. He alleges that the Bordeaux merchants pressured viticulturists by imposing such low prices that producers ended up selling below their production costs.

The merchants, however, argue that they followed standard brokerage practices, obtaining wines through a broker, Maison Lillet, who claimed to have engaged in “classic brokerage at market prices for the presented quality without any pressure.” The defence representing Cordier calls for a comprehensive study by an accounting firm, and questions the lack of specific financial data provided by Lacombe’s company. He also points out that Société Civile Fermière Rémi Lacombe sold its shares and assets for €18 million in September 2020 to the Chinese group France Fortress, referring to the disputed sale of Château Bessan Ségur and insists that “The plaintiff is not a farmer cornered by a system and on the verge of bankruptcy; he is a prosperous owner with 138ha under his management”. The court is expected to render its decision on February 22.

Meanwhile, a fifth crisis meeting was held on January 12 at the Prefecture of Gironde to discuss the vine-pull scheme across Bordeaux that has received more than 1,200 requests from winemakers to pull up 8,000ha. The prefecture announced that applicants would soon receive authorisation to begin removal work. However, this authorisation would not confirm eligibility for financial assistance. The final eligibility notification, including the eligible surface area, is expected at the end of the application process, starting in February.

Negotiated between the State, the Chamber of Agriculture, Mutualité Sociale Agricole (Agricultural Social Security), and professional organisations, the removal plan aims to reduce the Bordeaux vineyard’s surface area, especially for lower-tier wines struggling to sell. Viticulturists submitted 1,209 removal requests, with a total target of 8,000ha of vineyards. The crisis operation is accompanied by a payment of €6,000 per hectare, totalling €48 million.

The French government has allocated €30 million for payments, with the condition that the land is returned to its natural state or replanted with trees, meaning it has received more requests that its available budget. The CIVB will provide €19 million for the agricultural activity diversification, but it seems unlikely that the €6,000/ha target can be met, and A viticulturists may have to accept lower premiums.

The crisis group believes the removal plan will not completely address the situation. It emphasises the need for a shift in viticultural practices to adapt better the supply, promotion, and commercialisation of wines to meet consumer expectations. This map, published by Vitisphere provides insights into the distribution of uprooting requests across Bordeaux, showing a clear focus on Entre-deux-Mers and Côtes de Bordeaux.

Good news, though, from Sauternes and Barsac, as they launch this month the certified Sauternes Cask, aimed at the growing market for used Sauternes barrels for use in the whisky industry, and other distilled alcohols such as gin. To qualify for the certification, the barrel must be sourced from within the AOC Sauternes or Barsac, must have belonged to a winemaker from the appellation, and must have contained Sauternes or Barsac wine for at least six months.

Also…
The Bordeaux Interprofessional Wine Council (CIVB) has a new advertising campaign, which will be rolled out in France and abroad over the coming months. With the tag line, “Ensemble tous singuliers” in France and “Join the Bordeaux crew” for export, the new advertising campaign for Bordeaux wines, the largest undertaken by the CIVB since 2014, will be visible over the coming months in the press, on posters, at events and festivals and on social media. 

Sources: Vitisphere, Sud Ouest, Terre de Vins, Echos de Bordeaux