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US sales drive Cognac to fifth year of export growth

Published:  19 August, 2019

Cognac has reported export growth for the fifth year in a row. Shipments were up 6.9% in value and 2.5% in volume for the year ending 31 July 2019, the region’s governing body has revealed.

A total of 211.1 million bottles were exported, accounting for nearly 98% of all Cognac production. The exports were worth some €3.4bn, according to data released today by the Bureau National Interprofessionnel du Cognac.

The principal international market for Cognac is in North America, which imported 97.7 million bottles during the year, or 46% of all shipments, up 8.8%. In terms of value, exports to the Nafta zone rose 17.6% in value.

Of those 97.7 million bottles, 94.3 million – 45% of all Cognac exports – went to the US.

Exports in Europe fell 6.4% by value and 4.6% by volume, with notable market contractions in the UK, down 4.1% in value and 6.7% in volume, and Germany, down 5.2% and 6%. The UK has traditionally been Cognac’s most important export market within the EU and its fourth most important globally.

The fall in exports across Europe as a whole was offset to some extent by growth within Eastern Europe, which was up 3.5% by value and 4.2% by volume.

Shipments to the Far East constituted 60 million bottles, or 28% of all exports, down 1.5%. Export value to the region was up 1.8%.

In Cognac’s domestic market, sales volumes rose 9.3% while value declined 23.8%.

In terms of Cognac expressions, exports of VS, which constituted 51% of all shipments, rose 12.7% in value and 5.7% in volume. Exports of VSOP, which accounted for 38% of shipments rose 7.8% and 0.4%.

With further volume growth predicted, the BNIC is to acquire a further 10,000 ha of vineyards over the next three years. The expansion will add 13% more capacity to the 76,000 ha already under vine.

Cognac represents nearly a quarter of the total value of French wine and spirits exports.

It is one of the potential targets for punitive tariffs in the ongoing trade dispute between the US and the EU regarding subsidies to the aircraft industry, President Trump has said.