Wine and Wine Grapes

Wine grape updates

2025 wine grape crops are looking favorable.

The 2025 growing season is starting off well, with wine grape crops across the West looking favorable. Little to no frost damage has been reported. Vineyards in California started to see flowers develop in May, albeit a week late. Weather forecasts in major growing regions suggest limited chances of rain in June, which is supportive of healthy crops. Many growers are continuing to remove and/or minimally manage vineyards in response to oversupplied markets, though the total impact to the 2025 crop size remains unclear.

Year-over-year wine sales were down across each marketing channel in April. Escalating tensions with other countries are challenging the industry. Wine exports to Canada, the second-largest foreign market, have all but stopped as various provinces remove U.S. wines from retail shelves. International travel to California declined notably in February and March and many wineries are observing fewer visitations from foreigners. Wine imports held relatively stable in April but are likely to increase in May and June. The European Commission approved a $5 billion plan to increase French wine exports to the U.S. ahead of July 9 when tariff rates are expected to increase. France is the second-largest foreign wine supplier to the U.S. by volume. While countries may front-load wine exports to the U.S., some analysts expect total wine imports in 2025 to decrease from 2024 levels. Falling discretionary income among consumers remains a major concern for the industry, particularly as it relates to restaurant sales; however, a recent survey suggests consumers are more likely to cut back spending on other items prior to alcohol in response to higher living expenses.

Profitability

Falling wine demand, excess inventories and production capacity are pressuring prices and margins. Declining export demand may further challenge the industry.

The 2025 growing season could support relatively large, good-quality crops across the West. Currently, supply exceeds demand, and this is likely to continue over the next year. Producers with buyer contracts will fare better than those without.