Wine's Tough Times Bring Opportunity

Asking vintners how they’re doing today can be a fraught question. U.S. wines sales have declined for four straight years, according to my colleagues at Impact Databank. The 2024 harvest was California’s smallest in 20 years, as growers left 100,000 tons of fruit unpicked, rotting on the vine. Tens of thousands of acres of vineyards are being pulled out. Industry analyst Rob McMillan calls it the biggest correction in 30 years in his latest annual “State of the Wine Industry” report for Silicon Valley Bank.

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But let’s all take a deep breath. The next few years will not be easy for those who make their living growing grapes, making wine and bringing it to consumers. Still, there is plenty to be hopeful about, as well as plenty of work to be done. Wineries need to use this challenge as an opportunity.

The current tough times for wine are not exactly a surprise, but it’s been hard to really gauge the problem. The pandemic obscured many problems. In 2020, when we were locked away at home, U.S. wine sales grew 4.3% by volume, according to Impact. They’ve been falling ever since, including an estimated 2.4% decline in 2024.

But as McMillan points out, Impact’s numbers show that wine sales have been slowing for a decade now. Growth was 5.19% in 2015, then less than 1% each year from 2016 to 2019. Retail sales of lower-priced wines began to decline around 2017. This was offset by sales of higher-priced bottles, but it was a warning sign. Now sales of wine at almost every price point are declining.