Tension is at its highest in the historic Bordeaux and Burgundy regions, where producers are fighting a real ‘battle for survival’.

With up to 100,000 jobs at risk, the supremacy of French wine in world trade is being seriously challenged.

Tariff Dart Chokes Exports

The immediate economic catalyst for this crisis is the revival and consolidation of transatlantic trade tensions.

The new trade agreement between the US and the EU, sealed on 27 July 2025, established a 15% tariff ceiling on a significant part of European exports to the United States, the main market for prestigious Welsh wines.

This measure directly hits a sector that exports around €15 billion a year in beverages alone. The most pessimistic projections suggest that French sales to the American giant could be reduced by 20-30%.

And French wines are bearing the brunt, mainly due to the significant rise in the cost of entry for French prestige products that is drastically undermining their competitiveness vis-à-vis alternatives not subject to the same tax burden.

‘It is as if the Atlantic has become an invisible wall’.

🍇 Climate Disaster: The Worst Harvest in Seven Decades

Moreover, this tariff pressure has been compounded by an unprecedented climate crisis that has devastated production.

The 2024 harvest plummeted by about 20% from normal volumes. The chain of extreme weather events was relentless: late spring frosts, prolonged summer droughts and severe attacks of powdery mildew fungus, exacerbated by intermittent humidity.

Producers, who have staged massive protests, are demanding immediate compensation and authorisation to use European support stocks. More drastically, the government has offered subsidies for the forced grubbing-up of thousands of vineyards, a painful measure that underlines the economic unsustainability of many farms.

In fact, the seriousness of the situation has forced the French government, through the Minister of Agriculture, Marc Fesneau, to convene urgent ‘crisis talks’ by approving an aid package of €130 million.

🇪🇸 The New Configuration of the Global Wine Market

The French crisis has not only created a vacuum, but has also redefined the positions of the main players in the global market.

Thus, France's weakness is being exploited by key wine-producing nations, each with a different strategic positioning:

🇪🇸 Spain: The Leader of the Alternative and the Great Opportunity.

Spain, the world's second largest exporter by volume, is positioned as the best-placed candidate.

The 15% tariff on French wines (the same as for Spain) has reinforced their competitive advantage in terms of price, making Spanish wines significantly more attractive to US importers at present.

With the great advantage of the flexibility of the Spanish production structure, which allows it to rapidly increase exports and consolidate its position as the main alternative supplier.

🇮🇹 Italy: The Direct Competitor in the Premium Segment.

Within the EU, the other major wine-producing country benefiting from the French crisis is Italy.

Which is a formidable competitor to French wines, especially in the high-end segment.

🇨🇱 Chile and 🇦🇷 Argentina: The Giants of the New World.

These countries are dominant players in the US market in the low- and mid-price segments.

Their main advantage is the absence of tariff barriers with the US, which gives them an unbeatable logistical and cost advantage.

🇦🇺 Australia: Redirection Capability and High Volume.

Australia has the capacity to quickly redirect large volumes of exports.

Its wines, popular among American consumers, have a strong position in the low and mid-price segments.

🇪🇸 The Rise of Spanish Wine in the US

The crisis in France is a strategic window of opportunity for Spain to raise the perception of quality and the average price of its wines in the vital US market.

In fact, Spain's strategy focuses on promoting its most renowned Designations of Origin and boosting native varieties.

Spanish Wines Gaining Ground

The following Designations of Origin and varieties have great opportunities to increase their presence in the North American market as a result of the French crisis:

D.O. Rioja and D.O. Ribera del Duero: The Premium Alternative.

These regions are the direct substitute for Bordeaux and Burgundy wines.

Rioja (Crianza, Reserva, and Gran Reserva) offers quality and tradition at a more competitive price than Bordeaux red wine.

Meanwhile, Ribera del Duero, with its robust red wines based on the Tempranillo grape, competes in the niche market for powerful, high-priced red wines.

D.O. Rías Baixas: The Fresh White Wine Revolution.

Spanish white wine is also booming.

Albariño (D.O. Rías Baixas), with its mineral character and citrus notes, has become a very popular choice for seafood, a niche where some French white wines used to compete.

D.O. Cava: El Espumoso Competitivo.

Although Italy dominates with Prosecco, Cava remains the most internationally recognized Spanish sparkling wine.

Positioned in a very competitive price range, it is presented as an affordable, high-quality alternative to French Champagne.

Emerging Varieties: Garnacha and Mencia.

Garnacha, originating from regions such as Aragon and Catalonia, is being promoted for its versatility and fruity profile.

Meanwhile, Mencía (D.O. Bierzo and Ribeira Sacra) has become a cult product among sommeliers, offering a sophisticated, earthy profile that seeks to position itself in the high-quality boutique segment.

In summary, the combination of quality, competitive prices, and a void created by the French crisis gives Spain a unique opportunity to establish itself not only as a volume supplier but also as a prestigious leader in the global wine market.

Therefore, and for all these reasons, we at TRADE&TRAIL would like to remind you once again that...

THERE IS LIFE BEYOND TURKEY!!

🔗 Links Ofciales

The Guardian: French winemakers ‘battle for survival’ as minister prepares for crisis talks.

France: L’Etat dévoile un plan de sauvetage de la viticulture française en crise