This year was a bitter harvest for hundreds of American winegrape growers, as wineries cancelled contracts to purchase their grapes. Now, across the nation, thousands of acres of grapes went unsold this year and have been left to rot on the vine or on the ground, or the vines have been ripped out of the earth.
Why are American vineyards in crisis now, and how will this impact the U.S. wine industry, valued at $325 billion?
The main reason U.S. vineyards are in crisis boils down to an oversupply of wine in the market and in winery inventories, caused by a variety of factors. These include a decline in alcohol consumption, changing consumer demographics, rising inflation pushing wine prices higher, an increase in anti-alcohol groups, tariff pressures, and an influx of new beverage choices on the market, such as hard tea and THC-infused drinks.
“It’s a bloodbath for all grape growers across California. It is the worst market condition growers have seen in their lifetime, with farmers in their 80s telling me they have never seen it this bad before,” reported Stuart Spencer, Executive Director of the Lodi Wine Grape Commission, in a phone interview.
As someone who lives surrounded by acres of vineyards in Sonoma County, California, I have witnessed this with my own eyes. Just driving to the grocery store, I pass vineyards with grapes rotting on the vine and others that have been pulled out. When, only two years ago, all of the vines had been harvested and the grapes sold by this time.
“It is estimated that around 30% of Sonoma County grapes went unsold this year,” Karissa Kruse, President of the Sonoma County Winegrowers, told me.
In Napa Valley, Caleb Mosley, Executive Director for the Napa Valley Grapegrowers, said they didn’t have an actual percentage yet, “but definitely there are grapes that went unsold this year in Napa Valley and Napa County, and some of the wineries walked away from contracts.”
However, in every conversation, these industry experts also discussed some of the proactive and long-term solutions the growers are trying to implement to survive the oversupply situation.
So I decided to reach out to wine grape growers across the nation to see if the situation was as bad in other states, and if so, what solutions they were implementing.
Vineyard Crisis Extends to All Major Wine Producing States
California, producing 87% of U.S. wine in 2024, according to Wine Business Analytics, has obviously been hit quite hard by the wine oversupply crisis. However, in online interviews with experts in Oregon, Washington, Texas, New York, Ohio, Virginia and North Carolina – other large wine producing states – I discovered that they were also suffering similar challenging conditions, and trying to identify solutions.
Oregon (874 wineries): “This harvest season, we have heard from our growers that there are some who have had difficulty selling their grapes. Some growers have been able to keep their contracts, while others do not have any at all this season,” stated Gina Bianco, Executive Director of the Oregon Wine Board.
In terms of solutions, Gina said that “Some owners are pulling out portions of their vineyards for new crops,” or taking the time to investigate new climate and disease resistant rootstocks to plant in the future. “The wine growing industry is navigating a myriad of obstacles, but through all of this, we are still seeing winemakers produce another successful harvest with incredible fruit quality.”
Greg Jones, CEO of Abacela Vineyard and Chair of the Oregon Wine Board, reported, “We are seeing growers utilize several tactics, such as reducing management costs and evaluating vineyard design to better match with the climate and overall site productivity.” He added they are also rethinking canopy management, evaluating new grape varieties, and producing bulk wine to try to generate some revenue.
Washington State (854 wineries): “While we don’t have a specific percentage, many growers have shared anecdotally that they don’t have a home for some of their grapes this harvest. This is especially unfortunate given what has been an exceptional growing season,” reported Kristina Kelly, Executive Director of the Washington State Wine Commission.
For solutions, Kristina said, “Washington wine grape growers are meeting challenges with creativity and resilience. Many growers are diversified farmers and cultivate multiple crops which helps buffer market shifts. Growers and industry partners are actively working to expand sales channels. Our new national ‘Wine by the Glass’ initiative will help boost awareness and demand for local wines with key accounts and ultimately consumers.”
Texas (525 wineries): “Roughly 25 to 30% of grapes were unsold across the Texas High Plains, with a smaller percentage unsold in the Texas Hill Country. Some varieties, such as Mourvedre, were much closer to 40 to 60% unsold in the Texas High Plains,” reported Kirk W. Williams, a viticulture lecturer in the Viticulture & Enology Program at Texas Tech University.
To address the issue, Williams stated that “some growers have added winery operations and switched a portion of their crop to direct sales of wine.” However, he added that others “have abandoned their vineyards because the cost of pulling them out right now is too high. A few have put their vineyards up for sale or gone out of business completely.”
New York (452 wineries): I reached out to four different NY wine experts in the state, but none of them wanted to speak to this issue. Eventually, I found a grower and winery owner who agreed to provide some insights, but did not want to be named.
“I’m estimating that around 20% of the wine grapes in New York went unsold this year, but it could be as high as 30%. Growers have tried to find other buyers, but it is tough to sell much fruit because the larger wineries already have too much wine. In general, most of them are harvesting the grapes and letting them fall to the ground to serve as compost,” he said in a phone interview.
Virginia (390 wineries): “Pricing per ton has remained flat or has softened over the past 3 years, in spite of increasing vineyard management costs. The best data we have available suggests that 45% of our growers reported the inability to sell grapes at some point in the past 5 years,” reported Matthew Brown, Director of the Virginia Wine Coalition.
To address the issue, Brown said that Virginia growers are trying to right-size to match consumer demand. They have reduced the number of vineyard acres by over 500 acres between 2022 and 2024, and they have had around 30 wineries close in the past 2 years. “Most of our producers are too small to do much in the bulk wine market,” he added.
Ohio (336 wineries): “We do not have a huge number of acres, but along Lake Erie and in the Grand River Valley in NE Ohio, we have some wineries that share that at least 20% of the fruit is not yet sold. These are the same wineries winning in the SF Chronicle for some of the Rieslings, Chardonnays, and Cab Francs, along with their Ice Wines. They have traditionally been my star vineyards,” reported Donniella Winchell, Executive Director of Ohio Wines
In terms of solutions, Winchell explained that they are hosting a workshop for growers and wineries to create plans to push bulk ‘Ohio’ juice, and perhaps bulk wine sales. Fruit juice made from wine grapes has been an untapped product category, though there are a few wineries who had done this successfully for years, such as Navarro Winery in Mendocino County, CA.
North Carolina (202 wineries): “Overall, North Carolina growers are certainly feeling some of the same pressures affecting the broader U.S. wine industry, though the situation here is a bit more nuanced. Our grape mix—muscadines, hybrids, and vinifera—along with smaller, family-run operations that rely heavily on tasting room sales and wine tourism, has helped buffer some of the impacts, though visitors are spending slightly less per visit,” stated Nicole Chesney, Executive Director for the North Carolina Wine & Grape Council.
Chesney described some of the action NC growers and wineries are taking to address the slowdown. “Some wineries are carrying higher-than-desired inventory and have responded by selling grapes to other producers. What we’re seeing instead is a gradual shift—some producers are replacing vinifera vines with more resilient hybrid varieties rather than removing vineyards altogether.”
California Solutions (4,864 wineries): As the largest American wine-producing state, California growers started to feel the crunch about a year earlier than other states and pulled out 38,134 acres of vineyards between October 2024 and August 2025, according to Natalie Collins, President of the California Association of Winegrape Growers.
Collins said this data was acquired as part of a new 2025 California Winegrape Vineyard Mapping Project, with the research conducted by Land IQ. Through this, they have been able to verify that California wine grape acreage has now been reduced to 477,475 acres of standing wine grape vineyards. This type of accurate data is crucial to allow the industry to right size the supply/demand equation.
Like Oregon and Washington, many California growers are also using this time to let the land lie fallow to regenerate and replenish nutrients, while they research new varietals that consumers may prefer, along with rootstocks that are more adaptable to climate change. “In Sonoma County, many of our growers are taking this time to plan strategically for the vineyards of the future,” shared Karissa Kruse, with the Sonoma County Winegrowers.
Some growers have been lucky enough to sell their grapes on the bulk market, with much of the resulting wine going into private store, grocery store, or restaurant brands. This can be very positive for consumers, because some very high-end grapes will end up in these private-label wines.
“We also see some people switching into other crops, such as orchards, almonds, walnuts, and alfalfa,” reported Stuard Spencer, with the Lodi Wine Grape Commission, and “some families are putting their property up for sale.”
In Napa, Emily Hegarty, Operations Director with the Napa Valley Grapegrowers, was able to obtain a federal grant from the USDA to assist their growers. This resulted in $45,000 that they are using to provide educational sessions to help growers strengthen the financial, marketing, and legal foundations of their vineyard businesses for lasting resiliency.
Growers Waiting for the Market to Right Size
Based on the interviews with the larger U.S. wine-producing states, it appears that all are experiencing the downturn in the market. Though not all states have calculated the amount of grapes that went unsold this year, around 20% was a number that was mentioned repeatedly.
This corresponds with the number that Jeff Bitter, President of the Allied Grape Growers in California, provided. “I estimate at least 20% of California’s wine grape production from bearing vines was not harvested and crushed in 2025,” he reported in an online interview.
The big question on the mind of all grape growers is ‘when will the market right-size, and how many acres of vines need to be pulled out so that supply matches demand?’
The answer is not that clear.
For years, industry experts like Jeff Bitter and Rob McMillan of Silicon Valley Bank Wine Division have been urging the wine industry to try to match production to consumer demand, while at the same time innovating to meet changing consumer needs.
The challenge is that wine is an agricultural product, and the general wine industry doesn’t seem to innovate as fast as other consumer products. Once a wine grape vine is planted, it takes 3 to 7 years before the grapes can be harvested, crafted, and the wine offered for sale to the consumer. Factor in all of the international wine brands and changing regulations, and then it is clear why supply and demand often take more time to balance.
Furthermore, starting in 1996, the U.S. wine industry had over 20 years of growth until it started flattening out in 2018. There was another short upsurge during the COVID years of 2020 and 2021 when Americans drank more, but then wine sales started to decline. By the end of 2024, total U.S. wine sales had declined by 9%, prompting the removal of American vineyards.
So while there are a number of innovative U.S. wineries and start-up businesses that are working hard to increase the demand side of the equation, right now, many American wine grape growers are struggling.
But some industry insiders believe we may have hit the bottom of the market, and that the supply/demand equation may be balancing out soon. One of those is Jon Moramarco, partner and editor of The Gomberg Fredrikson Report and managing partner of BW166.
“By my estimates, the U.S. market can currently support 3.2 tons of California wine grapes each year. There is a lot of wine sold via private label that is not always calculated into the final numbers presented by many firms,” stated Moramarco in a phone interview.
Therefore, if in 2023, 3.68 tons were crushed and it fell to 2.84 million tons in 2024 – the smallest harvest in 2 decades – then market balance could be a possibility in the near future. Factor in estimates of 2.5 million tons crushed in 2025, as forcasted by Glenn Proctor of Ciatti Company, and this suggests that some of the pain could be abating for growers sooner than later.
“But,” said Moramarco, “consumers are changing every day, and if someone can create a wine product that matches the needs of Gen Z and other consumers, we actually may be in a position, where we do not have enough wine grapes to meet consumer demand – again.”
Here’s to innovation in wine!