In recent years, due to a lack of demand, a significant portion of European wine has been converted into cheap industrial alcohol, with the EU allocating millions in funds for this purpose. Since the start of 2023, over 105 million euros have been directed towards the crisis distillation of wine within the EU. This process involves distilling surplus wine at the expense of the EU to produce alcohol for industrial uses. In the previous year, approximately 34 million euros were allocated to wine distillation, despite a decrease in wine production to historic lows. The expenditure surged to nearly 71 million euros in January of the current year alone. France, Portugal, and Italy were the leading countries in terms of distillation costs, with totals of 68.5 million euros, over 18 million euros, and around 15 million euros respectively. Germany, however, did not participate in converting wine into industrial alcohol using EU funds during this period.
The EU Commission implemented a special measure in June of the previous year, allowing member states to employ crisis distillation to withdraw surplus wine from the market. This strategy aimed to stabilize the wine market and free up storage space for new wine, amidst challenges such as inflation driving up the prices of food and beverages, leading to reduced wine consumption, and farms struggling to recover from the impacts of the COVID-19 pandemic. During the pandemic, the EU had already dedicated hundreds of millions of euros to transforming European wine, with 250 million euros in 2020 (including 127 million for French wine distillation) and approximately 43 million euros in 2021, mainly for Romanian wine. German wine did not undergo crisis distillation with EU funds during the pandemic, as there were no significant sales difficulties according to the German Winegrowers' Association.