The year 2022 was a period of contrasting outcomes for Rhône Valley wine producers. Their total production volume decreased by 7%, resulting in about 886,000 hectoliters, while their overall value only slightly declined by 0.5%, amounting to €58m. Japan saw the most notable growth, with a 4% increase in volume, reaching approximately 28,000 hectoliters, and a 2% rise in value, totaling €16m. In contrast, Belgium, the largest importer by volume, experienced a 13% decrease in volume and a 15% reduction in value. The UK trended similarly, with a 10% fall in volume and a 2% dip in value, culminating in €84m.
The US, as the third-largest importer, observed a 10% drop in volume to 126,000 hectoliters, but interestingly, its value increased to €118m. Germany, holding its position as the fifth largest export market for Rhône Valley wines, witnessed a positive shift of 10% in volume and 6% in value. Overall, Rhône Valley's exports amounted to €58m, equating to the sale of 118m bottles at an average price of €4.97 each, underscoring the region's premium wine heritage.
The international market is not a central focus in the Rhône Valley's sales strategy. Only about 36% of the total production, approximately 885,000 hectoliters, was exported. The remaining portion of the 2.6m hectoliters produced in 2022 was consumed domestically within France.
However, the French consumers are also losing interest, as the gap between production and sales widens. Producers sold 2.8m hl in 2015/16, but now sales have dropped to less than 2.5m hl. Annually, between 100,000 and 300,000 hl fail to reach the shelves, leading to growing stockpiles.
The threat of crisis distillation hangs over the Rhône Valley, as with other red wine-focused regions like Bordeaux or Languedoc. Producers can register their reserves for distillation, receiving €75 per AOP hectoliter. The exact amount of wine to be distilled is still uncertain, as is the potential need to uproot vineyards.
Major appellations like Côtes du Rhône and Côtes du Rhône Village have seen significant sales declines, nearly 15% and 12% respectively over the past five years, while production in both AOPs has increased. The majority (60%) of AOP wines from the Rhône Valley are sold in bulk. The recent lack of contracts signed clearly indicates the declining demand for Côtes du Rhône wines. However, the crus, both in the north and south, are doing well in sales, with a few exceptions (Condrieu, Vacqueyras).
As often happens, it's the entry-level wines that are suffering. Last year, shortly after the harvest in November, producers focused on the issue of overproduction and sought permission to uproot red wine vineyards to plant white wine grapes instead.
A shift in color
The shift towards white wine is gaining momentum, as consumers are increasingly moving away from tannin-rich and extract-heavy red wines in favor of lighter, fruitier, easy-drinking options. According to data from the agricultural authority FranceAgrimer, red wine consumption within France has halved over the past 30 years.
"The Rhône Valley should establish itself in the minds of Europeans and North Americans as a major region for white wine production."
The potential of white wine is not limited to the entry-level appellations Côtes du Rhône and Côtes du Rhône Villages. AOP Gigondas, one of the 17 crus of the region, has also introduced white wine in its 2023 vintage. This decision followed a decade-long negotiation marathon between the appellation and the French regulatory authority INAO.
This move towards white wine production comes with its challenges. For the blend, a minimum of 70% of the white variety Clairette has been mandated. However, winemakers report that Clairette is not planted in such proportions in Gigondas. Many producers have had to establish new vineyards to meet the requirements for the blend. Therefore, this transition to more white wine will contribute to the market only in a few years. However, given the stable market performance of the AOP, there is not as urgent a need for change as in the lower appellation levels.
More crus, more success?
An unnamed producer explains that Côtes du Rhône has lost its distinct profile, which is why many are eager to get a share of the cru pie'. The small commune of Bourg-Saint-Andéol in the northern part of the southern Rhône Valley, along the banks of the Ardèche, along with three surrounding villages, achieved the status of AOP Côtes du Rhône Village with a specific locality label on the bottle a few years ago. Producers in this area report that such a designation is the only way to command higher prices. There are 14 winemakers working on 500 hectares, though the potential area for cultivation is reportedly three times larger. The AOP, with its red clay and silicate soils, is believed to have the right characteristics for stronger profiling.
The strategy is not to shift to white wine, but to produce higher quality and more expensive wines. Inter Rhône strongly believes this is a viable solution to combat the decline in sales: "It's a way to guide consumers and offer them a quality guarantee. These AOPs ensure adherence to strict specifications and precise origins. It also creates positive dynamics. To reach a higher level, winemakers must demonstrate to authorities that their wines meet certain standards. Local associations then initiate a movement among their members to get the geographical indication recognized. This has a positive effect and leads to a continual improvement in wine quality."
This approach seems logical, set within the Romanesque pyramid model of wine qualities. However, it's uncertain if consumers will easily follow this upward trend. Already, there are 22 communes that can add their names to the Côtes du Rhône Village label. But who has heard of Suze-la-Rousse, Rochegude, or Saint-Pantalon-les-Vignes – or even Saint-Andéol?
For the Saint-Andéol producers, the natural next step is attaining 'cru' status. Places like Gigondas, Tavel, Lirac in the south, and the well-known northern crus, have already gained international acclaim and corresponding price points. A cru designation would effectively distinguish these wines from the more generic, mass-produced offerings of the Côtes du Rhône appellation. The journey to becoming a cru is anticipated to be much swifter than the village upgrade, which took over two decades
Rosé is trending
Despite the current emphasis on white wine, Rhône rosé, which accounts for 13% of production, also has potential, particularly in the German market. Inter Rhône reports that over the last 12 months, Rhône-AOP Ventoux rosé wine sales in German supermarkets have increased by nearly 32.5%. However, success in this segment depends not only on origin but also on style. While some producers in the valley are adopting the concept of the lightly pink, herbaceous Provence rosé, others resist copying this style.
Severe drought, heavy bottles
The Rhône Valley, like many other wine regions, is grappling with the realities of climate change and sustainability. Hotter and particularly drier summers are posing significant challenges to wine producers. Anthony Taylor, PR and Export Manager at Gabriel Meffre, a major player in the region with around 15m bottles produced annually shares insights into these challenges.
"The drought this year has caused us a lot of problems. We had many berries, but they were very small and contained little juice," says Taylor. Instead of training vines for maximum sun exposure, leaves are now intentionally used as a canopy to protect the grapes from the sun. Irrigation, typically restricted to young vines or only allowed with specific government exceptions, is increasingly becoming a necessity.
In response to climate change, there is a growing interest in (new) grape varieties. More winemakers are turning to later-ripening varieties like Mourvèdre or Marselan to counteract high alcohol levels. Experimental varieties like Vidoc (red) and Floréal (white), as well as Carignan Blanc and Rolle, are currently under a 10-year trial.
When it comes to bottle weight, the region is facing challenges. Some appellations, such as Gigondas, use distinctive bottles with the AOP emblem on the neck to strengthen their brand identity. The idea of switching to lighter bottles, which might require abandoning these recognizable symbols, is not yet widely accepted among many producers.
Thinking beyond Appellation boundaries
In the Rhône Valley, there's a growing trend among winemakers to diversify their portfolios and experiment beyond the strict guidelines of their appellations. One such innovator is Raphaël Pommier from Domaine de Cousignac in the potential cru village of Saint-Andéol. Alongside traditional AOP wines in white, red, and rosé, Pommier produces his “PRO IB” line: “Produit par un irréductible assoiffé de liberté,” roughly translated as “Produced by an irreducible, insatiably freedom-thirsty.” Marketed as Vin de France, this gives Pommier maximum flexibility, particularly in terms of the variety mix. The current vintage includes a single-variety Viognier, a Grenache rosé, and a 100% Syrah – and Pommier, who works closely with nature and organically, doesn’t commit to this being the same next year.
Pommier’s content and packaging deliberately diverge from Rhône classics: wild, reductive, fruit-forward on the inside, and colorful and glittery on the outside – a true thirst for freedom.
Ambitious goals and new dynamics
Although these wines don’t directly contribute to the sales performance of the appellation, they are well-suited to show traders and consumers that a new dynamic has begun in the region. They can draw new attention to the region with all its appellations, potentially aiding Inter Rhône's ambitious goal. By 2035, they aim to significantly expand export business, with talks of up to a 50% increase. This boost is sorely needed, as the current export rate of 36% was already declining in 2022. The first five months of 2023 started even worse, with a 12% decrease compared to the same period last year.
Inter Rhône has therefore planned large promotional campaigns, especially in the B2B sector, featuring various events and trainings. New white wines, distinctive rosés, elegant reds, and quirky natural wines could be strong assets in these endeavors."