Compulsory purchase contract for Pays d'Oc making life difficult for wineries

Monday October 12 2020 by Vitisphere

 Although the majority of industry players are in favour of a balanced market, reactions to the measure on the ground have been varied Although the majority of industry players are in favour of a balanced market, reactions to the measure on the ground have been varied - Photo credit : Alexandre Abellan (archives 2019)

To maintain a balance between supply and demand, the Pays d'Oc wine producers’ organisation decided last August to only certify volumes with sales contracts. The measure, which caused a stir within the industry, had already been implemented at the end of the previous marketing campaign, after lockdown. The aim was that remaining volumes certified as Pays d'Oc would align with market demand in order to avoid a fall in prices at the end of the season. The measure was renewed at the beginning of the current season to prevent a flood of certified Pays d’Oc, particularly red wines usually labelled as AOC, entering the market. The drop in demand for red AOC wines could have prompted producers to fall back on the Pays d’Oc PGI and thereby cause prices to fall. Under the current rules, producers who want their wines certified as Pays d'Oc are required to attach a purchase contract for a similar volume to all applications for certification.

Although the majority of industry players are in favour of a balanced market, reactions to the measure on the ground have been varied. “We are working hard to ensure our customers get the best service, particularly quick loadings. This decision makes life more difficult. It is more restrictive for wineries that sell in bulk than for those that sell bottled wines. If the aim is to protect prices, the challenge may turn out to be an advantage. But it would have been preferable to set certification quotas based on volumes marketed in previous years, so that wineries producing Pays d'Oc PGI for a long time could have been given priority status”, says David Reverbel, director of the Le Pouget co-operative winery.

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