As vineyards across the West, particularly California, gear up for the winegrape harvest, growers are preparing for what appears to be a year of favorable yields but uneven market dynamics, according to a market update from the California Association of Winegrape Growers.
Despite early forecasts predicting a hot, dry summer, many winegrape regions experienced a surprisingly mild and cooler growing season, supporting average to above-average cluster counts and sizes. Growers have adopted strategies like bunch thinning, strategic vineyard removals and minimizing marginal acreage to help balance supply with fluctuating demand.
While crop quality looks promising, the market outlook remains cautious. Sales indicators show declines across channels — off-premise sales have dropped 5%, on-premise by 3% and direct-to-consumer by 1%, year on year. Exports across a number of countries have taken an especially steep plunge, with wine shipments falling 44% in June versus last year, reports AgWest Farm Credit. Meanwhile, survey data by Silicon Valley Bank reveals that only 16% of grape buyers plan to purchase more fruit in 2025, signaling subdued demand industry-wide.
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To manage oversupply risks, several regions — including parts of California — are implementing vineyard mothballing and thinning practices, according to Ciatti Co. Wine Brokers. These steps aim to moderate total tonnage and better align production with current market conditions.
As the 2025 harvest approaches, stakeholders anticipate strong yields but tread carefully given softening consumer demand, shrinking exports and rising operational costs. For growers with pre-sold contracts, the outlook remains more stable, whereas others will likely face continued pressure to find buyers or reduce volumes.
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