The Champagne Grapes of Wrath

OK. Enough about me and the Squires bulletin board--for now. It must be the season, because there's another David & Goliath story going in the fair land of golden bubbles. Over a year ago, biodynamic wine leader, Nicolas Joly, told me that a Champagne producer we both knew had seen the Big Boys of Champagne putting the screws on small producers--threatening to withdraw their grape growing contracts from them if they don't stop production. I had visions of cars on fire and broken knee caps. I snooped around as best I could from my perch, which wasn't really good enough. I asked this particular grower's importer what he knew. He kindly inquired on my behalf and in turn told me that the grower refused to talk, yet added, “He's hearing from his buddies that negociants are telling them that if they want to keep their (grape growing) contracts that they need to not let the world know that they are making their own (terroir-based) wines. “ The nice grape grower and champers producer was scared. Out of the blue I got an email from the syndicate --who I had not contacted--laughing off my hunt for truth. Then I got an email from the Washington-based Champagne board, telling me that there was no fire under that smoke. Now, 1.5 years later, August 2nd, on the Decanter site I see that was truth to the mess. Jane Anson reported: "Moet et Chandon is facing serious supply issues, the director of the Champagne house has revealed." She relates that Frédéric Cumenal, President of Moet & Chandon, who started out marketing for Procter & Gamble, said that a part of the problem is; “Small growers storing up to 100m bottles of Champagne in their cellars to limit tax bills and provide a source of income for their retirement.” And so….”a new rule has been introduced in the region for the 2007 harvest. Growers must save any excess grapes in years of good supply to put onto the open market in years of limited supply, which should help ease problems.” A few years ago I wrote a story on mono-cru and focused on David (grower champagne) and Goliath (symbolized by LVMH who owns Moet, Krug, Ruinart, Clicquot and Mercier) story. I wrote that it would not be long before the big houses ran scared. They were losing prestige (as geeks praised the small houses and turned up their noses, even at Krug as plonk) and at some point they were going to be hit in the pocket book because 1) they'd lose market share. 2) they wouldn't be able to have supply as more growers made sold their one instead of handing over their babies (grapes) up for adoption. I’m not sure how this will play out. How can they be forced to put their ‘excess’ into the market instead of in their own bottles? But they are the all powerful LVMH--as a friend of mine who used to work in fashion said, "They are in business of the allusion of luxury." Anything can happen. Like, the growers take their chances and say, fine, get your grapes elsewhere. Then they would have to take the risk on bottling all of their grapes. Of course that's a whopping risk. Champagne takes a while to cook. How will they make money while the bottles are marinating? With grapes they take in a certain amount of cash flow, up front, in the bank allowing them to produce their bottles, often far superior to the mass stuff. If they had to survive on their own champagne there would be a long time before they could float themselves to solvency. This is a seriously sour pickle. Champagne had always been based in a symbiotic relationship. Big Boy needs the Little Guy and Little Guy need Big Boy. LVMH should not be so smug about winning their battle. They just might lose this one because there may be a way out for the grower. Even though they represent a little over 2% of the entire production, they have more muscle than you'd think, and organized properly, the group might be able to sling the winning stone.