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French wine

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France is one of the oldest wine producing regions of Europe. It also produces the most wine by value in the world (although Italy rivals it by volume and Spain has more land under cultivation for wine grapes). Bordeaux wine, Burgundy wine and Champagne are important agricultural products.

Despite some exports from Bordeaux, until about 1850 most wine in France was consumed locally. People in Paris drank wine from the local vineyards, people in Bordeaux drank Bordeaux, those in Burgundy drank Burgundy, and so on throughout the country. The spread of railroads and the improvement of roads reduced the cost of transportation, but even until after World War II, the typical French person drank local wine and, although proud of France's reputation for making some of the world's outstanding wines, knew relatively little about them.

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The Appellation System

The increase in trade and export led to increases in wine fraud, whereby inferior wines were labeled as superior wines, or inferior wines were blended with the wines of well-known producers. A number of laws to fight cheating were passed in 1935. They established the Appellation d'Origine Contrôlée system, which is governed by a powerful oversight board. Consequently, France has one of the oldest appellation systems for wine in the world, and many other European systems are modelled on it. With European Union wine laws being modelled on those of the French, this trend is likely to continue with further EU expansion.

French law divides wine into four categories, with two falling under the European Union's Table Wine category and two falling under the EU's Quality Wine Produced in a Specific Region (QWPSR) designation. The categories are:

Table wine:

QWPSR:

France's best-known regional appellation system was developed in 1855, in preparation for the Great International Exposition in Paris. At the request of the Bordeaux Chamber of Commerce, the Union of Brokers Attached to the Bordeaux Market identified the Grands Crus (Great Growths) and organized them into five categories: four Premiers Crus (First Growths), 15 Deuxiemes Crus (Second Growths), 14 Troisiemes Crus (Third Growths), 10 Quatriemes Crus (Fourth Growths), and 17 Cinquiemes Crus (Fifth Growths). The rankings were based entirely on recent prices.
White wines in Bordeaux were also ranked. One (present-day Château d'Yquem) was uniquely ranked above all others in its own category, that of Premier Cru Superieur (Superior First Growth). There were 11 First Growths and 12 Second Growth white wines. These, too, were established entirely on the basis of recent prices in 1855.

Within two years after the classification system was published, wine sales by the classified producers increased over 250 percent. With the passage of time, many of the châteaux acquired additional vineyards far away, some sold part of their vineyards, some let their vineyards deteriorate, and many other changes occurred. Therefore, in 1961, the French government proposed deleting 17 châteaux from the classification. Because this would adversely affect the prices of their wine, political pressure caused the government to back down. The only change made was to raise Château Mouton-Rothschild to first Growth status after decades of relentless lobbying by the influential owner.

Wine critic Robert M. Parker, Jr. argues that the classification has long created an injustice to consumers because it has caused mediocre wines to be sold for too much and good wine to be sold for too little. He says that the archaic rankings "should be regarded by both the wine connoiseur and the novice as informational items of historical significance only."

Burgundy's classification system was created in 1861 for the Paris World's Fair in 1862. It has 110 appellations in an area only one-fifth the size of Bordeaux. Complicating the system is the fact that many villages have hyphenated their names to include that of their most famous producer. This promotes sales but tends to confuse consumers.

Terroir

Terroir refers to the unique combination of natural factors associated with any particular vineyard. These factors include such things as soil, underlying rock, altitude, slope of hill or terrain, orientation toward the sun, and microclimate (typical rain, winds, humidity, temperature variations, etc.) No two vineyards in the same area have the exact same terroir, although the differences are typically so small that they cannot be detected in the resulting wine...

Trends

France has traditionally been the largest consumer of its own wines. However, wine consumption has been dropping in France for 40 years. During the decade of the 1990s, per capita consumption dropped by nearly 20 percent. Therefore, French wine producers must rely increasingly on foreign markets. However, consumption has also been dropping in other potential markets such as Italy, Spain and Portugal.

At the same time, many rapidly growing New World producers are geared almost entirely to the export market. For example, a major Australian producer sells varietals that are specifically blended to meet American tastes. Its exports to that country alone went from 144,000 cases in 2001 to 7.5 million cases in 2005. That strategy is working around the world. In 2000, for the first time in history, Britain imported more wine from Australia than from France.

Consumers in the growing markets such as the United States prefer to buy wines labeled by variety of grape rather than geographic region of production. French law generally prohibits this practice, thus putting French producers at a disadvantage. Such laws may even put French wines at a disadvantage within the French market. A 2005 survey found that 72 percent of the adult French population finds it difficult to understand French wine labels (Franson, 2006).

Bordeaux alone has over nine thousand different châteaux, each with a different label. It has 14 Château with "Belair", 22 with "Corton" and 151 châteaux with "Figeac" in their names and on their labels. However, most New World consumers (and many in the Old World) want the simplicity of brand names.

It's difficult for a three acre vineyard producing its own wine to either establish visibility or to get a company to market its label. With no economy of scale and relatively high wage and fringe benefits contributing to high production costs, it's becoming increasingly difficult for French producers to compete internationally.

The result has been a continuing wine glut, often called the wine lake, that has led to the distillation of wine into industrial alcohol as well as a government program to pay farmers to pull up their grape vines through vine pull schemes. A large part of this glut is caused by Languedoc wine.

Immune from these problems has been the market for Champagne as well as the market for the expensive ranked or classified wines. However, these constitute only about five percent of French production.

French regulations in 1979 created simple rules for the then-new category of Vin de pays. The Languedoc-Roussillon region has taken advantage of its ability to market varietal wines. An Anglo-French project there has led to the highly popular FAT bastard label. As a company official says, "Even if people love a French wine, they can't remember its name." Fat Bastard solves that marketing problem. Plan Bordeaux calls for more wines to be labeled by grape variety or varieties.

In order to meet increasing world competition, France has approved the use of oak wood chips in aging wine in place of expensive oak barrels. This practice has been used in many New World wines for over a quarter century. The French Agriculture Minister called for "a new wine revolution" that would abolish what he calls the "elitist language" and "dozens of categories that turn shoppers off french wine."

In the face of economic difficulties on one the hand and proven success on the other, the French wine industry may become increasingly creative and innovative.

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