Will Champagne see a turnaround in 2025?

After two years of declining shipments of Champagne, the region’s top producers are hopeful for a turnaround in 2025. We look at the basis for optimism. As reported by db last week, during the course of the past 24 months, Champagne has seen shipments – including the French market ­– fall by almost 55 million bottles, taking its year-end total to 271m in 2024, from a higher of 326m in 2022. The causes of this decline are myriad, but chief among them has been the removal of reasons to celebrate: Champagne was a major beneficiary in the post-Covid period of elation, but war and recession have since destroyed high spirits. Then there’s been uncertainty due to elections, damaging sales in the UK and, especially, the USA. Driving Champagne shipments down has also been a high level of stock in the market, which affected last year in particular, as well as elevated bottle prices, with all players passing on cost increases to consumers – producing Champagne has become more expensive due to rising grape prices, as well as wages, energy, interest rates and raw materials such as glass. Other negative influences on Champagne sales have included falling drinks consumption generally; poor summertime weather in major European markets, such as the UK and France, as well as an increasing outlay on travel, eating into funds once used for treating oneself at home. So why would 2025 be any better for Champagne? That’s the question I put to a raft of major players in the region in late January this year, during a week-long visit to the region, and the responses were fairly consistent: this year should represent a turnaround for Champagne shipments. “It’s a new era,” said Sébastien Briend, managing director at Champagne Jacquart when asked why he believes the decreases of the past two years are behind the region. The major elections are over, and the world and its economies are more stable, he observed, with a hope for more “normal times” in 2025. This is key to Champagne consumption he stressed, because, he said, “We need political stability in the world to have economic stability.” Ruinart CEO Frédéric Dufour is also cautiously optimistic as he sees the recent period of declining orders coming to an end. “We see interesting pockets of growth, such as Japan, and a mid- and long-term bright future in the US, although we are braced for taxes [on Champagne under the Trump administration], which we see as a short-term challenge,” he said. As for Europe, he added, “We still see more opportunities than threats,” although he noted that growth for Champagne will come from international markets – “the French market is eroding structurally,” he observed. Believing that last year’s oversupply situation has now been worked through, Dufour does see shipments this year more closely reflecting consumption, and told db, “I believe the worst is behind us; we can be positive for Champagne”. Nevertheless, he and others don’t envisage Champagne reverting rapidly to its pre-Covid volume size of around 300m bottles. Not only does the consumer still need to digest price increases on Champagne, “but there is no enormous new market in front of us,” he said. In terms of the price situation, which has seen many Champagne brands raise on-shelf prices by around 25% over the past three years, he commented, “€40 [for a bottle of Brut NV Champagne] is a barrier for a lot of consumers, and the type of consumer who was buying from a good maison at €30-35 is now buying other categories: sparkling and non-sparkling.” As a result, despite his optimistic outlook, he did say, “I don’t know if the region will come back to 300m easily.” Generally, the hope is that the final six months of 2025 will see an improvement in Champagne sales. This is based on a best-case scenario, said David Chatillon, who is president of the Champagne Houses and co-president of the Comité Champagne. “While there is still uncertainly, most people think that the second half of the year will be better… perhaps there will be an end to the wars, stocks will have been cleared, and economic growth will be back.” Certainly Champange Boizel CEO Florent Roques-Boizel is positive in his outlook. Not only did he point out that other wine regions have been worse-affected by the recent downturn but he sees Champagne making a recovery and soon. “It has not been a good year for Champagne, but it’s not been dramatic, and I don’t see the desirability of Champagne decreasing, just people being more cautious about what they are spending,” he told db. Continuing he said of Champagne’s drop in shipments, “I think it is temporary, and linked to the general mood, and I think Champagne will come back – we’ve seen this before with cycles in Champagne.” And he plans for growth in 2025, based on fact that “Champagne prices are stabilising” and “the stock situation is now healthy – we hear that from our partners.” Another person in a positive frame of mind is managing director of Champagne Palmer, Rémi Vervier. “I think the lowest point was last year and I think it will be better in 2025,” he said, noting that he expected sales in the US and Japan in particular to pick up, as well as in Scandinavia and the UK. He also said that trends favoured his Champagne in particular, not just because “we are building distribution and brand presence,” but also because his product is relatively affordable. “We stay at an attractive price positioning: our La Reserve is around €40 in France – which is not cheap, but it’s not €50,” he said, referencing pricier rivals. Like Roques-Boizel, stressing the cyclical nature of Champagne sales is Deutz CEO Marc Hoellinger. “Champagne over the past 50 years has been very cyclical – there are highs and lows, and two to three years ago we were at a strong high, and now we are at a strong low; at some stage there will be a rebound,” he said. As for the longterm size of shipments, he says, “It is probably somewhere in between [the historical high and current low]” And like Vervier, he picks up on the issue of price, commenting, “€50 seems to be a psychological limit for Brut NV Champagne, and you see that in the French market, where the brands that are suffering are those over €50.” For Bollinger MD Charles-Armand de Belenet, “We believe this year, in the best-case scenario, that Champagne will go back to 280-290m bottles.” That he says is based on a better global political situation, noting that last year as much as 50% of the global population had to select new leaders. He also thinks that price stabilisation from Champagne producers will help – as opposed to another year of increases. However, if there was one aspect to Champagne purchasing habits last year, it was the need to discount prices to encourage people to stock up on the fizz. And such a mechanic to secure sales will be needed again in 2025, particularly in major mature markets such as the UK and France. For this reason, Bollinger’s de Belenet added that a Champagne rebound won’t be dependent on just retaining prices as they are, but also continuing a high-level of promotional activity. Bearing in mind the cost of stock being held by the Champenois has gone up – a result of rising grapes prices over recent harvests along with increased interest rates – margins are likely to suffer, even if total volumes of Champagne may grow. As a result, he says, “From a market point of view I am positive [for Champagne], but from a financial point of view, it will be difficult.” Similarly, Ruinart’s Dufour believes that, “profitability has gone down, and severely," for Champagne producers. This is due to declining sales of higher-value cuvées, as well as the fact “brands had to buy volumes with promotions”. “Over time,” he added, “This will balance out” – referring to the rising cost of production being passed on to the consumer. But for now, it’s clear that margins for brand owners are taking a hit.