Wine and Wine Grapes

Wine grape updates

2025 wine grape crops are looking favorable.

With favorable weather conditions thus far this season, wine grapes are progressing well across the West. Most expect average to above average yields with good quality fruit. Smoke-taint has not been an issue, but some are concerned heading into summer given abnormally dry soil conditions and low season-to-date precipitation levels. Smoke-taint occurs when wildfire particles get absorbed into wine grapes, causing unfavorable flavor qualities. Many growers are looking for ways to cut expenses, including limiting the number of dropping passes (removing fruit), minimally managing vineyards to limit production and/or removing acres altogether. It remains unclear what the net effect of these activities will be on total crop size.

Wine sales continued to decline year over year across on-premise, off-premise and Direct-to-Consumer channels in May 2025. The greatest declines were observed in price tiers ranging from $4.00-14.99/bottle. Anecdotal reports suggest some wineries are exploring alternative ways of reaching customers, such as hosting smaller tasting events and targeting niche markets such as cruise lines and airlines. Closures of small boutique wineries in Oregon (less than 5,000 cases/year) have been reported. Exports to Canada may be picking back up, though this is not yet reflected in trade data. Bulk wine inventories remain high, particularly for red varieties from Coastal California, and buyers are cautious to not over commit.

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.