Examination of Witnesses (Questions 240
- 246)
MONDAY 7 MARCH 2007
MS EVA CORRAL
Q240 Lord Cameron of Dillington:
But the table wines should be able to say what the grape variety
is and describe it in their own way, and at the moment the freedom
of entrepreneurs to sell their wine is very limited. That is why
we have major problems, it seems to me.
Ms Corral: I do not think that is a major problem
for the table wines to be sold. We do not have a clear position
on that but we could accept—and we are currently discussing
that so it is not yet really a position of the COPA-COGECA—that,
if a wine is to carry those Indications, then there should have
to be a cahier des charges or some control so that you
can determine that what is in the bottle is exactly what you are
putting on the label. This is a question of traceability which
I think is fundamental.
Q241 Lord Bach:
You have talked in some detail about your response to the competition
that there is from the New World in terms of wines, so I am not
going to concentrate too much on asking you to repeat yourself.
But, if I put to you this, that European wines have something
different, special, compared to New World wines, you would agree,
I think. Yet at the present time for various reasons European
wines are losing out. Is it really good enough just to say that
what European wines have to concentrate on is what is special
about them in order to remedy that? Or is it that really those
who produce European wines have to do something much more fundamental
in order to compete over the medium and long term? My worry is
that your response, which you have put so well, is that really
all you need to do is tweak or slightly change, slightly alter,
concentrate on the tradition rather than something else. I would
argue that that is not nearly enough and the New World will continue
to grow at our expense. What is your reply to that?
Ms Corral: I think I have already mentioned
that we have to change the system, the current Common Market Organisation
and all the amount of money that is spent in distillation, that
table wines should have a more open list of oenological practices,
that we will have to find for those wines an equilibrium so that
they enjoy some of the characteristics of these New World wines,
and that we will have to grub up some vines and do re-conversion.
I am not saying everything is rosy in the European wine sector.
We do have problems and we have a sector that is in some aspects
very heavy, so that is what we recognise, that we need also to
be flexible and simplify labelling to a certain degree, that some
of the producers will be willing to abandon the sector, and that
we will have to have this compromise for table wines to allow
them to respond more to this other new model. We talk about equilibrium.
What we do not want, according to our interpretation of it, is
what the Communication of the Commission is proposing, which is,
"OK, these third countries are very good. They are entering
our markets and they are conquering new markets, so we have to
stop everything and start producing as they are doing". That
is not realistic either, so we really have to find an equilibrium
between both of them. You are right: we cannot just rely on keeping
our system as it is 100%.
Q242 Lord Bach:
There has to be some structural change, does there not? That is
my question to you. We have to change the structure of the European
wine market in order to be able to compete. Would you agree with
that or not?
Ms Corral: We are going to have to have some
concentration of the exploitations, increase the size, concentrate
on selling our products, focus more on the market. Of course it
is going to have to be like that, but, as I was saying before,
can we change radically the structure of production so that we
are going to have 50-hectare exploitation only and things like
that? I do not think that is feasible. On the other hand, I think
it is very important to take into account also that most of the
wine production in the European Union is linked to the land, to
certain areas, what in French we call the terroirs. This
is what gives the identity to wines. If we are going to take all
the wine production from the areas where it is produced now, which
may be areas that are Objective 1, that are less productive, such
as the Greek Islands, and put it in the plains, irrigate it, we
are going to have much more productivity, we are going to have
bigger exploitations and we are going to have a product that has
no identity. Even if there are 10,000 Geographical Indications
in Europe and they are too confusing to consumers, consumers do
recognise Bordeaux, they recognise Chianti, they recognise Rioja,
they recognise Valdepenas, so this is something we have to take
into account.
Q243 Baroness Miller of Chilthorne Domer:
Earlier in your evidence you were talking about the generous pre-retirement
package to farmers and you indicated support for that. But I think
you said that it could have some landscape effects, and also you
spoke very passionately about the fact that, particularly in Languedoc/Roussillon,
the very villages and the schools and so on were all organised
around their production areas. How does your organisation view
the decoupled measures that might address some of those issues
by bringing money for rural development in to deal with those
landscape and social issues? Is that a desirable thing, to move
into decoupled measures?
Ms Corral: We were discussing this with the
Commissioner. Decoupling is a very difficult option to implement
in the wine sector because wine is not a commodity. How are we
going to fix a single payment for a product that has a high added
value and is very different? A red wine is not a red wine. A red
wine is a Geographical Indication from this country or another
one, or a table wine, or a white wine, or a different quality
wine. It is very difficult to fix a single payment in the wine
sector. Regarding rural development, it can be a very useful complementary
measure for the wine sector, but it cannot replace the Common
Market Organisation. Rural development is co-funded and rural
development measures are not applied to a sector; they are applied
to an area. Even if this area is structured around the wine, it
will not go to the wine producers. Also, there are these new 2007/2013
programmes. They have already been presented to the Commission
and they should be adopted, I think, in six months' time. I am
not the person in charge of this question in COPA-COGECA. This
means that, if those programmes are already on the table and are
going to be adopted, how are we going to introduce them into the
wine sector if the reform is still not there? That is all part
of the problem.
Q244 Baroness Miller of Chilthorne Domer:
Is that something you have raised with the Commissioner, that
the rural development programme is now more than in draft; as
you say, it is there on the table and there is a problem of accommodating
reform of the wine sector within it?
Ms Corral: That is a practical problem but,
as I said before, we do not agree. We do not think it is a solution
to take the money from the Common Market Organisation away and
put it into rural development, where it is going to be diluted
between the regions and with co-funding. That is not the way to
give dynamism to the wine sector in our opinion. We should keep
all the credits in the Common Market Organisation, which are not
so much if you look at the budget of the Common Agricultural Policy,
considering where the wine sector is in Europe.
Q245 Baroness Jones of Whitchurch:
We have been talking about where the impetus for change and reform
might come from, and obviously you have been talking to your own
members about that and you have some ideas for change. But in
parallel to that we see the big supermarkets coming into the market,
which are very powerful, certainly in the UK, in terms of deciding
what people should drink and what new wines they should explore.
70% of all wine drunk in the UK is bought from a supermarket shelf,
so they are very powerful. I wondered how you reacted to that,
because they will increasingly become the driver for change. They
will increasingly be, if you like, the voice of the consumer.
They will decide what consumers like, what tastes they like, what
changes they are prepared to consider, and they increasingly stack
UK shelves with New World wines rather than EU wines. I wondered
how you reacted to that. How do you manage that power of the supermarkets?
Ms Corral: I think this is a general problem
throughout the agricultural sector, the increased concentration
of retailers, and that the producers have been very disadvantaged
in relation to the big supermarkets, that are increasingly powerful
and concentrated. To a certain extent they do drive consumer demand
but they adapt from one country to another because they also listen
to what the consumer has to say. To give an example that is completely
different, it is like organic farming. I come from Spain, and
in the supermarkets it is absolutely impossible to find organic
farming products on the shelves because people are not aware of
them and they are not buying them. But, when I arrived here in
Brussels, I went to the supermarket and the shelves were full
of organic products, which was amazing, so they are also responding
to what consumers are asking for. It is absolutely true that they
have a lot of power in deciding what is put in the market but
they cannot impose something if consumers want something else,
and that is something with which we are going to have to work.
Q246 Baroness Jones of Whitchurch:
Is the danger not that we will all get left behind because we
will be arguing about the wording of an EU Directive or whatever
and meanwhile they will be deciding what the rules are and what
they are prepared to sell, which may or may not take a great deal
of account of the EU?
Ms Corral: We think we have to do promotion,
and we hold very strongly this idea of doing promotion and information
because it is fundamental if we are going to open new markets
and we want to re-conquer markets. Promotion can also be done
with supermarkets. Of course, it is a campaign that has yet to
be designed but it can also be done in the supermarkets with wine
tastings, with putting the products at the head of the aisles
in a place which is very visible to the consumer, and that is
something we have to invest in. We are very attached to this idea.
That is also why we do think that initially it is a very good
idea to give money for that inside the Common Market Organisation
instead of going to the programmes of promotion that already exist,
because those programmes are generic for all the agricultural
products and they are co-funded.[5]
In 2003 I think it was, out of all the money the European Union
gave to all the different agricultural sectors, only 6% was given
to the wine sector, so we want promotion inside the Common Market
Organisation to regain those markets and to inform consumers about
our product.
Chairman: Thank you very much for your
patience with us and the amount of time you have spent answering
our questions. You have given us a very clear account of the approaches
of your two organisations to this very important issue. Thank
you once again.
5 Note by Witness: COPA and COGECA do want
promotion programmes in the wine CMO. Back
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