Portugal to Tackle Oversupply

The Portuguese Ministry of Agriculture allocates up to €20m to distill overproduction.

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 Large volumes have been cleared for distillation (Photo: sichkarenko_com/stock.adobe.com)
Large volumes have been cleared for distillation (Photo: sichkarenko_com/stock.adobe.com)

The Portuguese Ministry of Agriculture has allocated up to €20m to distill surplus stocks of red or rosé wine. The funding is available to producers who apply for it by July 26. Only wines with Designation of Origin (DOP) or Protected Geographical Indication (IGP) status, which are considered to be quality or regional wines, will be eligible for distillation. The distilled raw alcohol can only be used for industrial purposes or as biofuel, as stipulated by EU framework legislation.

Portugal is expected to be the hardest hit by the wine sales crisis, with an estimated 34% drop in domestic demand due to inflation. In recent years, this country on the western edge of Europe has had the highest per capita wine consumption in the world. In 2022, the average Portuguese consumed 67l of wine, while France came in second with 4l , according to statistics from the International Organisation of Vine and Wine (OIV).

Boosting Wine Sector Exports

In addition to announcing support for the distillation of excess wine stocks, Portugal's Minister of Agriculture, Maria do Céu Antunes, reaffirmed that the export value in the wine sector is expected to exceed €1bn this year. Since 2009, the export value has steadily increased almost every year, reaching €941, in 2022, according to statistics from the Instituto da Vinha e do Vinho. In 2009, the value stood at €54m. During this period, the wine production volume has remained relatively stable, mostly between 6m and 7m hl. However, the proportion of simple table wine has significantly decreased, while regional wines have gained considerable importance, increasing from 1.3m to 2.4m hl. Nevertheless, many of these wines will likely need to be distilled due to the challenging economic conditions in the country. MS

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