Swiss Wine: An Ill Wind Blows

There’s an ill wind blowing through the vineyards of Swiss Romande. After a decade of below average harvests, and little wine to sell, the bumper crop of 2018 has left behind a glut and with it a bit of political turmoil. It seems during the down years, Swiss supermarkets — which sell more than 60% of all Swiss wine — switched gears and grew to love the higher margins afforded by cheap imports. Shelves normally reserved for Chasselas and Gamaret were stuffed with off-brand Amarones and lackluster Riojas. To complicate matters the famed Swiss consumer, while still buoyant, is not so thirsty as before. Worse still, what little wine the youth contingent drinks isn’t even Swiss.

These inconvenient truths, ignored for years, are now the stuff of panic and parliamentary debate.

The first public demonstration of distress was on September 19 in the form of a road-clogging tractor-takeover of the rond point in Satigny outside Geneva. Vigneron Lionel Dugerdil, proprietor of the Clos du Château, took to the streets with several of his colleagues demanding an adjustment to the federal import quota — from 170 million liters to 100 million liters a year. Never mind that the upper limit has not been breached in almost twenty years. Yet, with only a few trips around the circle, his mild display of civil disobedience ignited the Geneva wine community and gave inspiration to others farther afield.

Out of his modest protest arose an “improvised” gathering in Vaud on October 30 which tagged the nascent movement with its catchy name: Les Raisins de la Colère (The Grapes of Wrath). This gathering of a hundred or so, many of them young, included vignerons from Geneva, Vaud and Valais. They too called for an adjustment to the import quotas and announced plans for a protest (they charmingly called it an “apero“) at the Federal Assembly in Bern which they timed to correspond to the convening of a new legislature.

Later in November the Fédération Vaudoise des Vignerons (FVV) gathered in Bex to express sympathy for the movement but stopped short of supporting a protest in the capital. The Interprofession de la Vigne et du Vin (IVV) in Valais did much the same. Instead they pushed for a commitment from les grandes surfaces (supermarkets) to initiate a year-long, three million franc promotion under the banner “Swiss Wine, sans hésiter“. The feds provided the funding while Swiss Wine Promotion handled the logistics. Their calculation was simple: appeal to the patriotism of the Swiss consumer and provide incentive for the retailer. After all, they figured, if each Swiss consumer purchased an extra two bottles of Swiss wine a year, the problem would solve itself.

Other small encaveurs who routinely sell out their production were not inclined to rock the boat, but still wanted to express solidarity. A parallel campaign was initiated with the hashtag — #swisswinegreatagain — in which each participant sent a bottle of wine to Parliament with the following message: “Hey Berne, Nous sommes le vin Suisse“.

Unfortunately, larger cracks in the system were already appearing. Provins, the biggest player in Swiss supermarkets and producer of 10% of all Swiss wine, announced at a mid-November press conference a plan to modify a ninety year-old statute that requires it to accept all grapes proffered by its cooperative members. The director, Raphaël Garcia, cited the disadvantages of being a cooperative noting that others were free to refuse grapes, negotiate prices, or demand conditions for acceptance. A string of annual losses bolsters his case. Its members will vote on the change mid-December. Whatever decision is made it is sure to have consequences for all Swiss cooperatives and for the small farmers who depend on them.

As expected, those politicians willing to speak out expressed sympathy for the wine industry but categorically ruled out any adjustments to the quota-based system. Switzerland is already under pressure from its trading partners to liberalize markets, especially in the agricultural sector.

A view from the U.S. trade agency Export.gov:

Swiss agriculture is highly subsidized and regulated, with price controls, production quotas, import restrictions, and tariffs all supporting domestic production. Imports of nearly all agricultural products, particularly those that compete with Swiss products, are subject to seasonal import duties, quotas, and import licensing.

Import quotas are the preferred vehicle for the protection of the Swiss wine industry but even at this time, during a period of distress, quotas are more likely to be relaxed than tightened. Any tightening is viewed as counterproductive to the overall trading strategy.

In the end, lasting solutions must include a comprehensive approach. Increased marketing at the point of sale is a stop gap, short-term solution that does not address the issue of quality at the middle and lower-end. The old truism that the Swiss drink 98% of what they produce is under threat. To answer that threat, the wine industry must begin to look outwards, to foreign markets, which means that improvements across the board are necessary. The days of anemic Gamay and off-dry Chasselas are over.

Perhaps a better marketing slogan would be: “No More Wimpy Wines.”

 

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