The strong euro is doing little to help Burgundy wine growers in their efforts to restructure the sector which has been in a depressed state for the past two to three years.

Trade associations recommend that growers install higher volume production equipment, make greater provision for training and instigate changes in the financial running of their businesses in order to survive the current economic downturn.

While Chablis is one of the few wines resisting well in the current crisis, there is the growing fear that Burgundy's prestigious image as a whole is under threat.

Recently, the leader of the regional government expressed his indignation that Burgundy was not served during the official ceremonies at this year's French Grand Prix.

Out in the vineyards, the picture appears bleak. In the Saone et Loire region alone 234 small-scale growers are reported to be in financial difficulty and 600 have problems meeting statutory welfare payments.

However, there is hope that cash flows problems may be eased if demand picks up later this year and 2002 production begins to flow onto the market

For now, the strong euro against the dollar and the pound is weighing on export sales with the result that importers are able to live on their stocks and are placing fewer new orders.