Sat, Jul 24, 2004 - Page 6 News List

France endorses looser regulations on wines

AP , PARIS

Wine flavored with wood chips was, until recently, just the kind of thing France's vintners were proud to have nothing to do with.

But in a sharp break with tradition, the government agreed to allow this and other shortcuts to help French vineyard owners revive their flagging fortunes.

The plans, drawn up by the winemakers themselves, were endorsed by French Agriculture Minister Herve Gaymard ahead of a Thursday meeting with a group of lawmakers pressing for government action to stem the decline.

The new measures would not change the stringent rules governing top quality wines sold under prestigious appelation d'origine controlee, or AOC, labels.

But production requirements would be relaxed for mid-market Vins de Pays -- or country wines -- in a move designed to make it easier and cheaper to produce mass-market French wines in high volumes.

Speaking to reporters, Gaymard described the plans as a "global offensive for French wine" that would "clarify and simplify the presentation of French products on the international market."

Instead of branding their wine with obscure local place names, mid-market vintners could sell their products under the name of a single well-known grape -- even if up to 15 percent came from other varieties. Under current rules, only 100 percent Chardonnay can be called a Chardonnay.

The geographical areas from which vintners have to source their grapes would be broadened, making for a cheaper and more reliable supply as well as higher capacity. Wood chips could also be added to the maturing Vin de Pays to give it an oak flavor without using expensive wooden barrels.

Such cost-cutting tactics are already common across the rest of the winemaking world, including Australia and the Americas, but were viewed by most French winemakers as too unorthodox to contemplate -- until now.

"Most of our global competitors are using wood chips and we think we should be able to do it too," said winemaker Denis Verdier, who chairs the advisory board of France's National Wine Office.

"That's on condition that it's made clear to consumers when they've been used."

The collective change of heart is a sign of how tough times have become for winemakers as they face a slump in sales both at home and abroad.

Wine experts say a global oversupply of some 6 billion liters weighs on prices and makes mass-marketing campaigns crucial -- a factor that works against France's fragmented industry and its thousands of small-scale producers.

The value of French wine exports fell 10 percent in the first five months of the year compared with the same period in 2002. Exports also fell compared with last year, when revenues were boosted by a lucrative sell-off of Bordeaux made in 2000.

Wines from places such as Chile, Australia and California also overtook French wines on global export markets for the first time last year, as larger foreign producers such as US giant E&J Gallo Winery or Australia's Jacob's Creek drew on their superior margins and muscle. France exported 1.78 billion bottles; so-called New World vintners exported 1.93 billion.

But winemakers say their shake-up of France's hierarchical wine categories and rules could change all that, clearing the way for the creation of some big new French brands.

"We have several companies that will be able to get down to work with these rules," said Eric Tesson, a lawyer for the AOC winemakers' national body. "But we're still some way from any kind of Gallo a la Francaise."

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