Crisis Distillation

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The Wine Economist is reporting that the concept of crisis distillation is resurfacing in the global wine industry. This practice involves government programmes buying surplus wine to convert it into industrial alcohol, aiming to stabilise wine prices and grower incomes.

While it was a common practice in the European Union, especially during the COVID-19 pandemic, the situation today is different. The current wine surplus is more due to falling demand than excessive supply.

The EU has attempted reforms to make the wine sector more market-driven, but the effectiveness of these measures is still uncertain. Crisis distillation is seen as a temporary solution, and it’s unclear if it will bring long-term stability to the industry.