More Californians are swapping wine with other beverages according to a new report.
Wine and California have gone hand in hand since the Franciscan missionaries plopped Mission grapes—known as pais or criolla in South America—on its soil. Since then, the Californian wine industry has ebbed and flowed to become one of the largest on the planet.
This year, the trends are pointing to another downward swing. Less wine drinking means some industry voices are calling for wine producers to pull up vines.
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This follows other wine-growing regions with historically high wine consumption, such as France. In the French wine region of Bordeaux, the French government has given aid to growers who plan to pull up around 9% of their vines. Like California and the US, France is experiencing a major decline in domestic wine consumption and demand for exports.
What’s Driving the Downward Trend
It’s no secret. Young generations of Californians are drinking less wine. According to a report from Silicon Valley Bank, people are choosing non-alcoholic beverages, spirits, ready to drink cans, and cannabis infused products over wine.
This has led to overproduction and imbalances in the industry. The hardest hit sector has been budget wine. According to the report’s data, demand for wine under $12 has plummeted.
Although the demand for more expensive wine is still strong, it’s overshadowed by the fact that cheap wine just isn’t selling.
The Response
Allied Grape Growers’ president, Jeff Bitter, told the Unified Wine & Grape Symposium in January that he wanted producers to take out 12,000 hectares of Californian vines to fight against the over productive industry.
The market has fallen several times over the last decade, most significantly in 2019, when thousands of hectares of grapes were left rotting in the sun. This year seems to point to even lower sales.
During another slump in the market in 2014, grape farmers pulled around 15,000 acres of wine grapes in Central California’s San Joaquin Valley. In their place, farmers looked to more profitable crops such as almonds.
This year, industry experts such as Bitter are asking farmers in the Central Valley who sell wine grapes to low-value wine producers to remove some of their vines and counteract lower demand. Grapes such as merlot, cabernet sauvignon, and the infamous California Zinfandel are all high production grapes that grow well in the state’s Central Valley and can be sold inexpensively.
The Future
As wine consumption in California plummets, many winemakers and grape growers are hoping to future-proof the industry. By pulling out old vines, farmers can focus on more profitable grape varieties that they can sell for higher margins.
This could mean the days of cheap Californian jug and boxed wine may be over. Replaced by spirit-based canned alcohol, non-alcoholic drinks, and artisanal wine, sold for its quality and tasting experiences rather than its price.