Wine and Wine Grapes

December 11, 2024

Wine grape updates

Challenging conditions persist, but fruit quality is favorable.

Markets remain oversupplied and growers without buyer contracts are finding it difficult to find a home for their grapes. Year-over-year wine sales fell in value for off-premise (5%), on-premise (3%) and Direct-to-Consumer (12%) outlets in October. Falling wine demand is pressuring margins for retailers, distributors and producers.

California – Wine grape crops were generally down across California, particularly Sauvignon Blanc and Cabernet Sauvignon in the North Coast, Cabernet Sauvignon and Pinot Noir in the Central Coast, and a myriad of varieties in the San Joaquin Valley. The San Joaquin Valley may experience the smallest crop in two decades due to lower yields, reduced acreage and grapes left on the vine. Despite lower yields, quality is reportedly average to excellent across the state based on location and variety.

Washington – Wine grape crops came in largely average in terms of size and quality, with some reports of smoke taint across the state and frost damage near Lake Chelan.

Oregon – Wine grape crops came in very good in terms of quality, despite some reports of smoke taint across the state and powdery mildew in some spots in the Willamette Valley. Some growers left grapes on the vine due to weak markets.

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.