When Moët raises prices, producers worry

Thursday January 18 2018 by Vitisphere

- Photo credit : Creative Commons CC0

The MHCS (Moët Hennessy Champagne Services) group decided in early October to significantly increase the purchase price of grapes, offering 5% more than last year. The average price is estimated at between €6 and €6.10/kg for the 2017 harvest. “While grape prices generally increase at between 1 and 2% a year, this year they grew by 5% to 6%,"said Franck Hagard, co-chairman of the Champagne brokers' federation.

The initiative by Champagne’s leading player prompted widespread comments. Although MHCS, which markets the Moët & Chandon, Dom Pérignon, Veuve Clicquot, Ruinart, Krug and Mercier brands, accounts for less than a quarter of Champagne sales, the group sets the tone for the price of grapes for each crop. And as almost all transactions involve grapes, the price of the fruit is essential.

 

Most purchases followed suit

 

With inter-branch contracts due to be renewed after the 2018 harvest, it is only logical that the leader wants to boost trust amongst its buyers," claimed Eric Potié, chairman of the Champagne co-operative winery federation. “The group aims to ramp up its supplies. It has the ability to do so because it markets its Champagnes at good prices”.

The SGV is more concerned and fears that winegrowers will be tempted to sell more grapes and that the number of wine merchants will decrease. “The price of grapes has reached new heights”, Maxime Toubart told the AVC (Association Viticole Champenoise) at its AGM on December 6. “There is nothing unpleasant about earning more, but let us make no mistake. The objective is not to enable us, grape producers, to earn more. The purpose is quite different”. In other words, the aim is to secure greater market share.

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