The number of wine producers converting to organic viticulture has tripled in France during the last five years, taking the sector from scarcity to abundance.
However, the increase has been so rapid that organic producers are now faced with a conundrum: will increased supply wipe out the price premium that organic winemakers need to charge to survive?
By the end of 2012, France had some 65,000 hectares of vineyard in organic production. That represents 8.2 percent of all French vineyards according to Agence Bio, a promotional body for organic agriculture. In comparison, the figure for organic production in French agriculture as a whole was just 3.8 percent.
“In organic farming, wine is the sector that’s grown the most quickly,” says Agence Bio chairwoman, Elisabeth Mercier.
Indeed, organic wine production in 2012 was estimated at 1 million hectoliters. It's predicted to reach 1.4 million this year and will double in 2015. Independent winemakers have been joined by wine cooperatives which have also converted to organics; today, they account for 20 percent of production by volume.
Mercier explains that growers who move to organics cite concerns for their own health and that of the environment: according to the French National Institute of Agricultural Research (INRA), grapes are the second most heavily sprayed crop (six to 20 sprays a year) after apples. A study published this month by consumer advocacy group Que Choisir found traces of pesticide residue in 92 wines.
Growers also believe organic wine production could have potential economic benefits, as well as being keen to respond to "a growing demand from society" for organic products, adds Mercier.
However, there is now concern about the size of the organic wine market.
“At our winery, we’re faced with an increase in volume, without necessarily having the market demand,” says Gilles Ferlanda, head of the Vaucluse cooperative Coteaux de Vizan and also chair of the national association of winemaking cooperatives' organic wine commission.
“We’ve gone from a situation of scarcity to a situation of abundance, without having had time to create a market for it," Ferlanda reports. He hopes that in two or three years' time, demand will rise. “We’ve seen growth this year in the Côtes du Rhône, with a call for tenders from Sweden for 5,000 hectoliters. That’s new.”
But are people prepared to pay extra for organic wine? Growing grapes organically is highly labor-intensive and it's estimated that 3.5 full-time staff are needed per hectare compared to 1.8 in conventional agriculture.
Richard Doughty, a British winemaker who’s been in the Dordogne since 1988 and now chairs the industry association France Vin Bio, says "maintaining an adequate price is of crucial importance for the future of these producers."
Prices are a sticking point, admits Ferlanda. "Organic wine used to sell at almost double the price of the conventional product. We have to be able to count on a premium of 30 to 40 percent, otherwise it’s not going to be profitable.”
At the start of the harvest last week, he was anticipating a “small, very small harvest, but good quality.” The smaller volumes may alleviate any over-supply, but the long-term prospects for organic growers are not so healthy. Ferland fears that if new markets prepared to pay a price premium for organic wines do not develop, some growers will convert back to conventional farming.