California farmers are struggling to sell grapes as demand for wine
drops
[September 23, 2026] By
TERRY CHEA
LODI, Calif. (AP) — It's harvest time in California wine country, but
many growers are struggling to sell their grapes as changing drinking
habits have caused demand to plunge. The decline is forcing some growers
to tear out vineyards that their families have grown for generations.
Wine sales have decreased by more than 20% over a five-year period,
causing prices paid for grapes to drop and prompting California growers
to take roughly a quarter of the state's vineyards out of production.
Many growers are having to decide whether to harvest at a loss, leave
grapes on the vine or replace vineyards with crops more in demand such
as almonds, walnuts, pistachios and olives.
Third-generation grower Bill Berryhill said it means another year of
losing money and wasting hundreds of tons of healthy grapes.
“It’s just sickening,” said Berryhill, standing in a vineyard of unsold
merlot grapes. “You raise a beautiful crop, and it’s really a nice
vintage this year, and you drop it on the ground. It’s sad. All your
work is just down the toilet.”
Berryhill, who owns Berryhill Family Vineyards near Lodi in the San
Joaquin Valley, said he can’t find buyers for grapes grown on 200 of his
500 acres (202 hectares). He plans to remove 50 acres (20 hectares) of
vineyards when the harvest season is over.
“I will lose money for sure. It’s just a matter of how much,” Berryhill,
68, said. “This has been a big loser for three years now.”
Grape growers take vineyards out of production
At its peak during the pandemic, California had almost 600,000 acres
(242,811 hectares) of vineyards, but farmers have removed or stopped
actively growing wine grapes on roughly 25% of that land, said Jeff
Bitter, president of Allied Grape Growers, which represents about 500
farmers statewide.
This year, about half of California’s wine grape crop entered the
harvest season without contracts with buyers, compared with 70 to 80%
with contracts in a typical year, Bitter said.
If they’re lucky, growers can sell their uncontracted grapes at a loss
to buyers making concentrated syrup.
Even as growers have abandoned or removed tens of thousands of acres of
vineyards in California in recent years, too many grapes are still being
produced, Bitter said.
“The market is just so depressed that it’s difficult to grow them
profitably,” he said. “Demand is not going up. It’s still continuing to
decline.”
Kyle Collins, a Lodi-based operations manager with Allied Grape Growers,
recently examined ripe grapes in a petite verdot vineyard in Lodi, one
of California’s most productive wine regions.
“Unfortunately, we do not have a buyer for these grapes,” Collins said.
“That’s unfortunately a reality for not just this vineyard but a lot of
us around here.”
Besides hurting vineyards, the drop in sales has hit local businesses
and workers, he said.
“That’s not getting into the pockets of the people doing the field
labor, the farmworkers,” Collins said. “It does have a trickle effect in
the economy.”
Wine sales fall after years of growth
The downturn is a dramatic shift for the wine industry in California,
which produces more than 80% of U.S. wine due to its unique geography
and Mediterranean climate. For decades, California’s wine industry grew
steadily as Americans, particularly baby boomers, developed a taste for
cabernet, zinfandel, chardonnay and other varietals.
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Unsold wine grapes line a vineyard at Berryhill Family Vineyards in
Clements, Calif., Sept. 10, 2026. (AP Photo/Terry Chea)
 The most famous wine regions such as
Napa and Sonoma Valley produced premium vintages while the Central
Valley grew grapes for less expensive labels.
Wine sales peaked during the pandemic in 2021 when restaurants were
closed and social gatherings restricted. People stocked up on wine
and drank more at home.
But over the past five years, wine sales have declined sharply, and
they’re expected to fall further this year.
In the U.S., sales of wine cases declined 23% from 427 million in
2020 to 329 million in 2025, while total wine spending fell 22% from
$94 billion to $74 billion, according to First Citizens Bank,
formerly Silicon Valley Bank, which produces an annual State of the
Wine Industry Report.
Wine industry faces more competition, tariffs and changing tastes
California can’t export its excess inventory because wine
consumption is down globally and it’s more expensive to produce in
the U.S. than countries such as Argentina and Australia, Bitter
said. In 2025, global wine consumption declined 2.7% from 2024 and
14% from 2018, with sharp declines in Europe and China, according to
the International Organization of Vine and Wine.
There are a variety of forces driving the decline in wine sales.
Baby boomers are aging out of the market while young people are
drinking less alcohol due to health and financial concerns. Wine
faces competition from craft beer, liquor and canned cocktails as
well as cannabis.
“The kids just aren’t drinking as much,” Berryhill said. “And it’s
not just wine, it’s whiskey and beer and everything. And then you’ve
also got the competition with all the seltzers.”
Tariffs have reduced exports, particularly to Canada, which was the
largest foreign buyer of American wine.
“The next step in the healing process is not only balancing supply
and demand, but now actually figuring out what it is that the other
consumers want,” said Rob McMillan, chief wine strategist at First
Citizens Bank.
The industry hopes the market will bottom out soon. Meanwhile,
growers are absorbing heavy losses trying to hang on.
Berryhill, whose grandfather started growing grapes nearly 100 years
ago, doesn’t plan to give up on wine even though it’s costing him.
“I love growing grapes. It’s in the blood,” Berryhill said. “Because
I love them, I can weather this and I’ll fight through it.”
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