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Celebrations in Champagne as wine region expands

Faced with the problem of rocketing demand and a limited growing area, the fiercely protective guardians of France's Champagne region have settled upon a simple solution – extending the boundaries within which the wine can be produced.

Only wines made within a specific area of eastern France, the borders of which were laid down by law in 1927, are allowed to use the appellation d'origine contrôllée (AOC) label for champagne.

The problem has arisen because, on top of established European markets, a growing thirst for champagne in China and Russia has left vineyards pushed to keep up. In China, consumption has leapt by 30 per cent over the past five years to 656,000 bottles in 2007, and in Russia, sales grew by 41 per cent to 1.03 million bottles last year.

For almost 90 years the number of rural districts to hold the Champagne AOC stood at 319, covering 15,000 vineyards across 33,500 hectares of countryside around Reims and Epernay, making 280 brands. By comparison, 120,000 hectares are cultivated for Bordeaux. Efforts were made last year to ease the shortage by lifting the cap on vineyard production from 13,000kg of grapes per hectare to 15,500kg, but producers were still unable to meet demand.

So yesterday, France's National Institute of Origin and Quality voted unanimously to grant the AOC to a further 38 communes, or rural districts, bringing the total to 357. A list of the new districts will be released in two weeks, said Yves Bénard, of the institute. The decision would allow vineyards to "produce more champagne with a higher than average level of quality", said Jean-Marie Barillère, the director of champagne resources at Moët Hennessy, the region's top producer last year.

It would also end attempts by vineyards to gain an AOC label through the courts, said Patrick Le Brun of the champagne producers' trade group SGV. In 1995 the town of Fontenay-sur-Ay set a precedent by winning the right to plant 30 hectares of grapes for champagne production after 13 years of legal battles.

But more than 300 communes had been under consideration since the expansion plan was considered in March 2006, and not everyone will be overjoyed when the new additions are made public. "If your vines fall on the wrong side of the divide, they will be worth €5,000 (£3,850) a hectare. On the other side they will be worth a million euros," said Gilles Flutet, the institute's director of demarcation. Nor will the expansion mean an instant boost to production: it must still be ratified by France's state council, which is not expected to issue a decree on the matter until next year, and the INAO must evaluate the quality of potential plots before awarding planting rights. Champagne drinkers may have to wait 10 years before the first new AOC wines reach their glasses.

France pioneered the AOC, which was later taken up by other countries, mainly in Europe, after a glut in wine production and quality-related frauds led to riots early last century. The Champagne AOC was introduced to protect peasant farmers making the highest-quality version of the wine.

American producers of sparkling white wine argued before the World Trade Organisation in 1994 and 1995 that champagne had become a semi-generic term, giving them a right to use it. They failed.