French winegrowers call for an international reform of the Olympic average for crop insurance policies

fter a devastating series of frost, hail, mildew and drought events, the 2021 vintage has not only seen French wine production fall, but also the Olympic averages of insurance companies, in other words the average production over the last five years minus the two extreme harvests, the best and the worst. With small yields that can finally be insured (with an excess clause), “who could imagine that business managers would be stupid enough to take out an insurance policy just for the principle of being insured when it does not allow them to tackle the reality of adverse weather events”, claims Jean-Marie Fabre, chairman of the French independent winegrowers’ organisation.

A winegrower in Fitou, Fabre views this as a major stumbling block to developing insurance cover for the wine industry, at a time when adverse weather events are becoming more and more recurrent. “Even in the event of extreme weather, compensation will not address the issue because of this benchmark system based on previous records”, warns Fabre, who is calling on the authorities to change the current regulatory framework. This is no easy task, as the regulations are supranational, depending not only on the European Union, but also on the World Trade Organisation (WTO).

Signed in 1994 in Marrakech, the WTO's international agreement on agriculture only authorises state aid to secure agricultural incomes with a benchmark of Olympic or three-year averages. To reform the system, the chairman of France’s independent winegrowers’ organisation believes that France can leverage its presidency of the European Council, which lasts for six months starting on January 1st 2022. This opportunity could set the ball rolling for a review involving every country around the world affected by climate change, from Europe to the United States, via Australia.