Wine and Wine Grapes

February 12, 2025

Wine grape updates

Negative press threatens public perception.

Alcohol is in the news again, and public perception is at risk of turning negative on moderate amounts of alcohol consumption. The Surgeon General issued an advisory in January 2025 stating alcohol is the third leading, preventable cause of cancer. This follows on the heels of the World Health Organization’s claim that any amount of alcohol consumption is carcinogenic. While the advisory cites numerous studies, it does not cite the extensive research suggesting moderate levels of consumption can be beneficial, or at least not harmful. An in-depth posting by Harvard’s School of Public Health directly contradicts these most recent claims, concluding that the effects of alcohol are complex and “blanket recommendations about alcohol are out of the question.” Wine Business Monthly published an article in March 2024 showing how a few temperance organizations are finding success in shaping perception and consequently, public policy.

The dollar value of on-premise and off-premise wine sales fell 4% and 7% year-over-year in December, respectively. WineBusiness Analytics reports the number of wineries declined in California by 3%, Oregon by 5% and Washington by 2% in 2024. Wine exports could be negatively impacted by countervailing tariffs. The U.S. exported $1.17 billion of wine in 2024 as of November, of which nearly $400 million went to Canada, $82 million to China and $22 million to Mexico.

Profitability

December 11, 2024

Wine: Breakeven profitability - Neutral 12-month outlook
Wine grapes: Breakeven profitability - Neutral 12-month outlook

Weak demand, changing demographics and oversupply will continue to challenge the industry in 2025.

Markets remain oversupplied and while growers with buyer contracts should generally be profitable, those without contracts will have a difficult time finding a home for their grapes.