France is seeking permission from the European Union to distil 600,000 hectolitres of table wines and vins de pays in order to reduce surplus stocks which have built up during the current economic slowdown.

Producers would receive EUR26m in public aid in compensation, subject to EU approval.

State food agency, France Agrimer, says the wine-making sector has been"confronted with a significant fall in the number of (wine) transactions in the past few months."

Compared to average stocks representing 9.5 months of consumption, current levels are the equivalent of 11 months. At the same time, prices for table wines have declined steadily while those for vins de pays reds and rosés are stagnant. "These figures point to a consumption crisis rather than one of over-production," France Agrimer adds.

The distillation measure must be approved by the European Commission within the framework of a modification to France's national wine plan, which will be presented by 30 June.

If the go-ahead is granted, distillation would have to take place within a maximum of three months.