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Waning interest in wine among domestic consumers and weak sales to China have led to an oversupply of French wine, which the government plans to spend 200 million euros to improve.

The French Ministry of Agriculture has received approval and financial support from the European Union to launch the "Crisis Distillation Aid", which is expected to go mainly to the Bordeaux and Languedoc regions. Under the program, wine is distilled into ethanol, which can be used for industrial purposes such as perfume or hand washing gel.

Another program compensates winemakers who agree to tear down their vineyards and convert their land to woodland or fallow. About 1,000 wine farmers in Bordeaux have applied for such assistance to clear 9,200 hectares of vines, or about 8 percent of the region's total planted area.

The wine industry estimates there will be a surplus of up to 300,000 kilolitres of wine this year, equivalent to 7 per cent of last year's 4.2 kilolitres.