Paris, Dec. 18 - The price of Chablis white wine is set to rise sharply next year as producers seek to recoup a rise in grape costs that has hit their profits, the chairman of producer Laroche said on Tuesday.
"We are now forced to raise prices and the increase will be brutal. We are all in the same boat," Michel Laroche told a conference on the company's first-half results.
Laroche's net profit in the six months to Oct. 31 fell to 60,000 euros from 650,000 euros in the same period a year earlier, mainly because the cost of buying the grapes used to make Chablis rose 20 percent, the company said on Tuesday.
Laroche said despite being in the business 40 years he had not anticipated the increase and so the company had only negotiated a 1.1 percent rise in its customer tariffs.
While its Chablis volume rose 12.1 percent to 118,863 nine-litre cases for a total value of 9 million euros, it lost 90,000 euros in this business after a profit of 580,000 euros in 2006/07.
The company covers around 26 percent of its Chablis production with its own vineyards in Burgundy. The rest it buys in.
"The price of (supplies) will go up again by around 15 percent in 2007, which will lead Laroche to increase its tariffs by between 6 and 13 percent next year," the company said.
Laroche said the cost of white wine varieties was also rising in southern France due to a poor 2007 harvest. The popularity of wines made from Pinot Noir grapes had pushed up their cost by 60 percent.
Laroche said it would therefore raise prices for its wines grown there by between 3 and 10 percent.
"Planting is now being undertaken which will should allow the market to progressively rebalance in the next three years," the company said.