French government allocating big bucks to dump wine due to lack of demand

The French government is allocating €200m ($215m+) to dump a surplus of wine and provide aide to its producers, due to a creeping lack of demand now that more and more drinkers seem to favor craft beers.

According to BBC, overproduction and the cost of living crisis factors in to this need to adjust, citing European Commission data for the year which shows that wine consumption has fallen 7% in Italy, 10% in Spain, 15% in France, 22% in Germany and 34% in Portugal. Per their reporting, "most of the €200m will be used to buy excess stock, with the alcohol sold for use in items such as hand sanitizer, cleaning products and perfume."

Agriculture Minister Marc Fesneau says that the French government aims to stop "prices collapsing... so that wine-makers can find sources of revenue again." He adds that, "the wine industry needs to "look to the future, think about consumer changes ... and adapt." This new trend is not exclusive to the countries referenced above. According to Forbes, wine sales have been declining in the U.S. as well.

"Increasingly, the U.S. is becoming a two-pronged wine market, where less-engaged, more price-sensitive (and often older) consumers are reducing their activity or leaving the category altogether," says Richard Halstead, COO Consumer Insights, IWSR Drinks Market Analysis.