Oak barrels used for storing cognac at the Remy Martin factory in Cognac
by Sybille de La Hamaide
Sales and exports of French spirits have continued to decline since the start of the year as consumers reduce their spending in a context of inflation, the French Spirits Federation (FFS) announced on Thursday, which is also concerned of growing trade tensions with some of its main markets.
Cognac producers said on Wednesday they were “deeply” concerned about the possible conclusions of an anti-competitive investigation opened in January by China, after the imposition by the European Commission of customs duties on imports of Chinese electric vehicles into Europe .
Exports of French spirits fell by 13.2% last year in volume, to 406 million liters, and by 12.2% in value, to 4.8 billion euros, announced the FFS, including a collapse of 36% in value and 35% in volume towards the United States.
Cognac exports, which represent 70% of the total, plunged by 21% in volume in 2023. China represented 19.4% of these exports, according to cognac producers.
“The consequences of inflation in third countries are now giving way to ongoing trade conflicts whose resolution is threatened, such as the United States for example with uncertain presidential elections, or those which are emerging like the investigation anti-dumping launched by China”, declares the FFS.
Remy Cointreau shares, a significant part of which comes from the Asian market, lost 6.02% on Thursday on the Paris Stock Exchange, falling to a more than seven-year low. Pernod Ricard also suffered but significantly less (-0.93%).
In 2024, nearly two thirds of spirits exports, by value, are shipped to “very risky markets,” says the FFS.
Export markets are all the more important as alcohol consumption is falling steadily in France, with a fall of around 60% in 60 years.
Sales of spirits in mass distribution have fallen by almost 10% since 2020 and by 4.3% in 2023 alone to 251 million liters, said the FFS.
“The first months of 2024 leave an even more bitter taste: the decline in volumes is around 5% compared to the previous year and marks an accelerating downward trend,” warns the federation.
Certain categories served in cocktails, such as gin, are however spared, unlike digestives with declines of 6.4% for whiskeys or 3.8% for rums over the first months of the year.
(Report by Sybille de la Hamaide, French version Bertrand Boucey, edited by Sophie Louet)
