Cognac Producers Request €40 Million in EU Aid After Chinese Tariffs Slash Exports

Cognac producers are seeking €40 million in European funds to support the uprooting of thousands of hectares of vines, following a sharp decline in exports and revenue. The request was formally presented by Florent Morillon, president of the Bureau National Interprofessionnel de Cognac (BNIC), during a meeting with French President Emmanuel Macron at the Wine Paris event on February 9. The industry is facing a significant downturn, with exports dropping to 141 million bottles and €2.24 billion in revenue projected for 2025. This represents a 15% decrease in volume and a 25% drop in value compared to 2024, bringing the sector back to performance levels last seen in 2010.

The decline is attributed to two main factors: a global reduction in wine and spirits consumption and an ongoing Chinese anti-dumping investigation. The Chinese probe was launched as a retaliatory measure against European tariffs on Chinese electric vehicles, placing Cognac and other French spirits at the center of a geopolitical dispute unrelated to their industry.

Morillon emphasized that European agriculture is increasingly exposed to such geopolitical risks, affecting not only wine but also sectors like dairy and pork. He argued that when EU decisions benefit some industries but harm others, there must be compensation for those negatively impacted. “We cannot have Cognac and Armagnac taken hostage because Europe chose to protect its automotive sector,” Morillon said. He warned that failing to secure compensation would set a negative precedent for future cases where agricultural sectors are caught in international disputes.

During the meeting, President Macron acknowledged the need for “reparation” and recognized the €500 million loss suffered by the Cognac industry as a result of the Chinese investigation. The BNIC is requesting €40 million to fund vine removal at a rate of €10,000 per hectare for between 3,500 and 4,000 hectares that have lost their markets permanently. Morillon described this as a reasonable request, especially given that the sector was losing €50 million per month during the period when provisional Chinese tariffs were in place.

On February 3, Morillon met with Agriculture Minister Annie Genevard, who confirmed government support for taking the compensation request to the European Commission. This follows correspondence from Brussels in fall 2025 indicating willingness to discuss measures if approached through the French government. Morillon noted there had been some hesitation from Paris at the end of last year but said pressure from producers helped move the process forward.

The government’s earlier uncertainty appeared linked to France’s November request for €80 million in EU crisis reserve funds for emergency distillation measures across all wine regions. However, Cognac producers insist their request is separate and specifically addresses losses caused by the Chinese investigation, not broader economic challenges or declining consumption.

Morillon stressed that while falling sales are partly due to global trends, the impact of China’s actions requires targeted compensation. The BNIC is also working with national authorities on both permanent and temporary vine removal programs, seeking additional funds specifically for Cognac beyond those allocated for general support of the wine sector.

Industry leaders hope that securing this compensation will not only help Cognac recover but also establish a framework for supporting other agricultural sectors affected by future geopolitical conflicts. For now, they await further action from both Paris and Brussels as discussions continue over how best to address the fallout from international trade disputes beyond their control.