The French government has received authorization to release €120 million in subsidies for the permanent uprooting of vineyards.
According to multiple French media reports, the European Commission has approved the French government's plans. The approval follows months of negotiations between France and the European Commission.
The funds will be distributed as direct grants to winegrowers who commit to permanently removing their vineyards, either reducing their vineyard area or exiting the wine industry altogether. No subsidies will be provided for temporary uprooting. Each business can receive a maximum of €280,000. The aid is only available until December 31, 2024, meaning applications must be submitted within this year. The application process is expected to be available online starting in mid-October. The uprooting must be completed by May 15, 2025, according to Vitisphere.
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Quick action required
Those interested in uprooting and receiving compensation need to act quickly. A grant of €4,000 will be provided for each hectare of uprooted vineyard, allowing for a subsidized removal of up to 30,000 ha.
The subsidies are especially welcomed in southwestern France, where many vineyards have been left fallow due to low bulk wine prices and declining demand, making cultivation unprofitable. Dominique Granier, president of the regional land development organization 'Safer Occitanie,' predicted as early as spring 2024 that 'tens of thousands of hectares' would be uprooted once state subsidies were released—which has now happened.
However, the subsidies may not apply uniformly. Since the goal is to reduce production capacity, fallow vineyards may be excluded from the grants, explained Jérôme Despey, chairman of the Wine Council at FranceAgriMer, in a statement to Vitisphere.
Brussels keeps watch over state aid
France was unable to approve its state subsidies without the consent of the EU Commission due to EU state aid regulations, which are part of EU competition law. Articles 107 to 109 of the Treaty on the Functioning of the European Union outline the rules governing state aid by member states. These rules are designed to ensure that state aid neither distorts competition in the internal market nor affects trade between member states. VM
