Wine consumption is declining and, yes, there’s a glut of grapes. Unsurprisingly, economic anxiety is the track of the day.
While the wine lake in Europe has prompted major headlines regarding full-on policy intervention, the U.S. hasn’t escaped its share of the gloom. California in particular — representing well over three-quarters of total domestic production — appears to be approaching dire straits. While this year’s totals are still up in the air as harvest and crush continue, the January 2025 data according to California-centric bulk wine broker Turrentine shows about 25 million gallons of California wine on the market, the majority of it red.
Within the context of the past two decades, that’s an unprecedented ocean. Likewise, California-based Ciatti, the world’s largest bulk wine broker, has repeatedly referred to “sticky inventory” in its reports as a polite term for “We’re drowning in wine.”
Underneath the depressing news, though, there may be a silver lining to tease out. After all, according to basic economics, more supply should mean lower prices. And a string of excellent vintages over the past few years bodes well for the quality of said ocean sloshing around the Golden State and elsewhere. All this potentially sets up a prime opportunity to pair domestic bulk wine greatness with a winning value-brand concept, right?
The case for a domestic bulk-based breakout brand
Wine is grappling with a diminishing slice of the beverage-alcohol pie, and the industry desperately needs innovative answers at the value end. The current bulk market dynamic could spawn that savior product or business concept to help shore up the ongoing generational market decay.
According to Sid Patel, CEO of the Beverage Trade Network and International Bulk Wine and Spirits Show, the moment is theoretically ideal to develop new, high-quality value offerings in the $10 to $20 range.
“Right now, the bulk wine market is in a very unique position,” he says. “We’re seeing incredible quality on offer, and at prices that, frankly, don’t come around often. A lot of juice that would normally be snapped up for higher-end programs is now available at value levels because producers need to move volume.”
It’s absolutely a buyer’s market, with those looking to procure high-quality bulk wine spoiled for choice. “Large wineries are using this moment to secure blending wines and lower their cost of goods, while smaller, boutique producers are taking advantage of the variety available to experiment with new products,” Patel adds. “Everyone, from value-focused retailers to private label specialists, is looking to see how they can use this glut to their advantage.”
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