The bubbly's all shook up

The world of champagne is fizzing like a bottle jerked around by a racing driver. Sales will reach an all-time high of more than 320 million bottles this year, as the world prepares to celebrate a new century and a new millennium. The biggest remaining family-owned champagne house, Laurent-Perrier, hopes to cash in by floating itself partially on the Paris Bourse next week. Five of the best-known champagne brands have changed hands in less than a year.

Such a frenzy of demand for champagne, as a drink, and as a business, is a subject for joy in the chalky ridges of north-eastern France, which produce the world's best-known wine: a wine synonymous with celebration. But the more cautious, and wiser, champagne producers and traders are wary of a 21st-century hangover.

Although every effort has been made to ensure there are plenty of stocks for the last night of the year, and the first morning of a new millennium, the big champagne houses remain anxious about the possible effects of speculation and deliberately manipulated foreign shortages. They say emphatically that they do not want a big bubble in champagne prices in 1999, which could play into the hands of their increasingly competitive rivals for the wired-cork market from other parts of the world (and even other parts of France). An increase in prices of 5 to 7 per cent is the most that they expect or condone.

An extra 74 million bottles have been released from a strategic reserve, purposely created over the last eight years to make sure that champagne does not offend its traditional - or new - customers with millennial shortages and high prices. Some in the champagne industry are, nonetheless, fearful that demand might outstrip all expectations or that retailers - and especially supermarket chains - might decide to generate shortages of their own.

"We can cope with a surge of 10 per cent of demand but beyond that we might be in trouble. Honestly, no one can say exactly what will happen," says Yves Benard, president of the union of champagne houses.

Smaller producers are dismissive of talk of shortages. "I think the big houses started the rumours and now they have become a little scared of the consequences," says Philippe Gue, a champagne grower, who sells under his own label in Chouilly, just east of Epernay. "There has been increased demand but nothing we cannot cope with. A prodigious amount of champagne is drunk every Christmas and every New Year's Eve. There is a limit to how much more can be drunk for the millennium - even in Britain."

Mr Gue, and others, are worried, however, about another possible consequence of the continuing boom in demand for champagne. Although there will be an inevitable dip in sales in 2001, market analysts reckon that, world economy permitting, champagne will resume a steady 2 per cent annual increase in sales in the first years of the 21st century.

The problem is that the Champagne region is already almost to the limit of what it can grow, under the present legal restrictions on acreage of vineyards and production methods. There were 292,458, 092 bottles sold last year (two-thirds in France, with Britain, the second biggest customer, sinking 24 million bottles). Existing vineyards can probably produce about 300 million bottles a year.

There has already been a steady rise in active Appellation d' Origine Controlee planting areas in the last 20 years, offending some purists, and growers, who fear that the reputation of champagne is being undermined by poorer quality grapes. Under the planting restrictions, first mapped in 1927, there are a further 1,500 hectares (4,000 acres) of marginal land, which could legally be used to grow champagne but which now grows cereals or rape-seed. There are plans afoot to plant vines in all this land over the next five years, bringing maximum production up to about 320 million bottles. But what after that?

Some growers - and would-be growers - are already pointing out that the 1927 mapping had nothing necessarily to do with the factors which make one plot good for wine and another only for sugar-beet (a mysterious blend of soil qualities, micro-climates and directions of slope). They say that many villages in the Champagne region refused the now-treasured "appellation" in 1927 because, at the time, it was more profitable to grow wheat. Jealous of their neighbours' smarter long-term choice, they would now jump at the chance to grow champagne grapes.

Mr Gue is worried by this kind of talk. "I have myself benefited from the expansion of approved planting areas in the past, so I have to be careful what I say. But the fact is the more that growing is extended to marginal areas, the more we risk diminishing the quality and reputation of the whole champagne appellation."

This argument is complicated by the fact that the chain of production in Champagne differs from all other French wine-growing areas. In Bordeaux and Burgundy the quality and reputation of the labels is rooted in the near-mystical belief that great wines grow in unique plots of soil; the wines are known by the name of the chateau (Bordeaux) or the village (Burgundy) where they were grown.

Champagne, by contrast, is dominated by, and known by the names of, the big champagne companies - Moet et Chandon, Veuve Cliquot, Mumm and Laurent-Perrier. These big houses grow few grapes of their own. They buy and blend grapes from different parts of the region to create a pre-ordained taste and level of quality.

This is much closer to the industrial approach used by the great Californian and Australian wineries, usually decried by French wine chauvinists. Champagne purists insist that it is the only way to make high- class champagne. Wine from one vineyard is "simplistic". To achieve greatness, it must blend the differing qualities of grapes grown in different parts of the region.

With the boom in demand for champagne in recent years (despite a slump in the early 1990s economic downturn), there has been a surge in direct sales by grower-producers, making wine from their own grapes. Some of these champagnes are - to my, perhaps, uneducated taste - excellent and relatively cheap. Anyone visiting France this summer, and fearful that champagne prices might surge in Britain this winter, might be well-advised to detour to Champagne and sample, and buy, some of these one-grower labels (from about pounds 7 a bottle). Mr Gue in Chouilly is one place to start.

Nonetheless, the danger of a demand-led expansion of champagne-growing areas - even to land already mapped for champagne use - remains real. The big houses would stick with the growers they know and would always be able to maintain quality. But there might be a proliferation of cheaper blends, and one-grower champagnes, which could progressively undermine the reputation of the region.