Brussels, 05/03/2012 (Agence Europe) - The economic and social consequences of liberalising the vine planting rights are considerable, according to a scientific study carried out by AREV, the Assembly of European Wine-Producing Regions. This study is to feed into the debate on ending planting rights, particularly within the “high-level reflection group” to be set in place by European Agriculture Commissioner Dacian Ciolos to examine the planting rights dossier in the wine-producing sector.
It was 80 years ago that France and Spain first put in place a system of regulations for the control of the planting of vines. In terms of the European Union, with the exception of a brief respite from 1970 to 1976, the CMO (Common Market Organisation) “temporarily” adopted these regulations. The permanent disappearance of these regulations, validated in the texts of the latest reform in 2008 for implementation by 1 January 2016 or the latest by 2018, was sufficiently justified, but as the deadline approaches, the wisdom of this deregulation is increasingly being called into question on a European scale by a large number of professionals and regional elected representatives, who fear that it may lead to disastrous consequences.
The study commissioned by AREV shows that: - the size of the business is not necessarily synonymous with economies of scale and growth in terms of income; - the price of planting rights does not significantly increase the cost of creating a vineyard; - if applied less than rigorously, a planting rights system will not effectively assist in avoiding overproduction (Alentejo, Argentina, Aquitaine, Loire Valley), and will often have a negative chain reaction on more virtuous regions; - the absence of systems to regulate planting in the New World has not enabled Europe's competitors to avoid imbalance in the market; - other countries have removed this system, but due to their inability to enforce the rules, and have set in place other market regulation measures (Argentina); - the planting rights system has not “rigidified” the vineyards, but has facilitated reallocations in the regions in which opportunities seem to be on the increase (France, Italy, Alentejo).
According to this study, the examples of Australia, where the hierarchical organisation of wines by territory is still in its early stages, and of Argentina, where they have only regulated part of the territory, show that “the production potential must be controlled for all categories of wines”.
The logic of the elimination of planting rights forces a focus on the future location of the new plantations with regard to the current vineyards. Will these new plantings be created in competition with the winegrowing agricultural zones (as yet unplanted demarcated geographical zones) or with the general agricultural zones, or the zones to be cleared? “In any case, the environments and landscapes of the winegrowing regions will inevitably be affected. But even if the economists are unable to put a figure to this impact, they are able to state that relocation towards the plains will begin, and eventually will damage wine tourism and its burgeoning economy, as well as the competitiveness of the vineyards located in the mountains or on steep slopes - with the resulting environmental consequences”, the study reads.
The evolution of the wine sector in recent decades has principally been marked by an undoubted move towards industrialisation, which is pushing the wine merchants to move into the production side - a process that necessitates significant recourse to external capital. In addition, financial pressure due to the recession is forcing merchant companies to make fast and significant returns on their investments: hence their need to produce large volumes and sell them quickly.
So far, 14 member states have taken position against the end of planting rights in 2016. However, the required qualified majority (255 votes) has not yet been reached, making it possible to overturn the decisions made in the 2008 reform. (LC/transl.fl)