(1)

The Union wine market has been facing difficulties due to a rapid decline in consumption in the Union and in main third country markets, to growing uncertainties caused by the geopolitical and economic situation and to climate change affecting production. Red and rosé wines in some producing regions are the most affected.

(2)

In the German wine-growing areas of Württemberg and Rheinhessen, available evidence shows a deep decline in sales and market prices of quality wines with a protected designation of origin, paired with a drastic increase in costs of production (input, energy, minimum wages), indicating a market crisis that weighs on operators.

(3)

The volume of red wines submitted for quality wine certification in those two areas, which is a faithful indicator of the volume of wine with protected designation of origin placed on the market, has decreased by more than 25 % in Württemberg in 2026, and 25 % in Rheinhessen in 2025, compared to the average previous five-year period, thereby following the decreasing trend of the previous year. Similar trends are observed for the rosé wine, for which the cumulated market sales of wines with protected designation of origin decreased by 19 % in 2026 in Württemberg, and by 25 % in the Rheinhessen wine-growing region in 2025, the most updated data available, compared to the average of the five previous years. Overall, the decrease in certification has been much greater than the decrease in wine production compared to the previous year, which can be expected to have further increased the stocks.

(4)

The impact of this situation has been a reduction of market prices in the two regions. In Rheinhessen, prices of red and rosé wines in 2026 were respectively below 27 % and 29 % of the average of the previous five years 2021-2025. Red wine of grape variety Dornfelder, mostly present in the Rheinhessen wine-growing area, has been particularly affected with a decrease of 37,5 %. In Württemberg, the average prices for red and rosé wines follow the same trends as Rheinhessen. In 2026 (January-May), the average barrel prices recorded are 70 cent/L and 60 cent/L for PDO red and rosé respectively.

(5)

Considering the current market situation, the excess volume of stocks of red and rosé wines in those regions is estimated to be around 0,24 million hectolitres. The removal of this volume of wine in Württemberg and Rheinhessen will allow Germany to address the market imbalance in the most affected market segments of red and rosé wines for the marketing year 2026/2027 and prevent the current disturbances from turning into a more severe or prolonged crisis and spreading to other Member States’ wine markets.

(6)

To avoid any abuse or overcompensation following the implementation of this exceptional measure, distillation will target exclusively the red and rosé wines with protected designation of origin, which are the wines mostly causing market imbalance in the two wine-growing regions, and the compensation amount for the wine withdrawn from the market will be set well below the relevant recent market prices. Germany considers that a compensation level of EUR 59 per hectolitre for all wine distilled (red and rosé) would allow the removal of 0,24 million hectolitres of those wines. Considering that the cost for transport and distillation operations is estimated to be EUR 16 per hectolitre and included in the EUR 59 per hectolitre, the payment for the wine withdrawal would be about 65 % of the average market price of the overall PDO red and rosé wine recorded in the two regions in 2026.

(7)

Germany has declared its inability to remove the volume of red and rosé wines in excess from the market with national payments as provided for under Article 216 of Regulation (EU) No 1308/2013. Any other measures available under that Regulation appear to be insufficient or not suitable to address the current market imbalance in the German market. Therefore, it is pertinent to make use of the agricultural reserve to implement a targeted crisis distillation in Germany, limited to the wine-growing regions of Württemberg and Rheinhessen. Germany intends also to provide for a grubbing-up intervention under its CAP Strategic Plan, which has been taken into account in assessing the necessity and proportionality of the targeted crisis distillation provided for by this Regulation.

(8)

To avoid distortion of competition, the use of the obtained alcohol should not be permitted for the food and drink industry and be limited to industrial purposes, including disinfection, pharmaceutical and energy purposes.

(9)

Germany should communicate to the Commission detailed information about the implementation of this Regulation, to enable the Union to monitor the efficiency of the measure introduced hereby.

(10)

The current market situation in Germany requires a rapid intervention with immediate effect on the market in order to avoid the disturbances spreading to the coming marketing year. Additionally, a timely monitoring of the budget as well as an up-to-date follow-up and efficient use of the agricultural reserve should be ensured, thereby maximising its availability and enhancing the capacity to respond promptly to emerging crises. The Union should therefore finance the expenditure incurred by Germany to implement the measure provided for in this Regulation only where such expenditure is made by a certain eligibility date. Support for this exceptional measure should therefore be paid by 31 May 2027. Any payments made after the eligibility date should be considered ineligible for Union financing.

(11)

As no payments made after 31 May 2027 are to be considered eligible under any circumstances, Article 5(2) of Commission Delegated Regulation (EU) 2022/127 (2), which provides for a proportional reduction of the monthly payments effected after the deadline, is not to apply.

(12)

To protect the financial interests of the Union, the national competent authorities of the Member State applying the exceptional crisis distillation measure are to perform checks to verify the compliance with the conditions and requirements set out in this Regulation.

(13)

For imperative grounds of urgency, considering the ongoing market disturbance as well as the short time available to Germany to start implementing the measure included in this Regulation before the forthcoming harvest in 2026, it is necessary to take immediate action and remove the excess of supply from the market as soon as possible to prevent further deterioration of the market imbalance. Delaying action would risk reducing its efficacy to stabilise the German wine market.

(14)

In view of those imperative grounds of urgency, this Regulation should be adopted pursuant to the urgency procedure laid down in Article 228 of Regulation (EU) No 1308/2013.

(15)

In view of the necessity to take immediate action, this Regulation should enter into force on the day of its publication in the Official Journal of the European Union,