The latest in a line of ‘wine crisis’ is upon us. Falling consumption, rising production costs, climate change and health concerns have heralded a loop of doom and gloom headlines for the industry. In January this year, Jancis Robinson MW wrote in her Financial Times column: “The world has too much wine. What will happen to it?”
In terms of wine in bottle (or in tank ready to be bottled) it appears that, as usual, the wine will find its price – even if that represents a significant downturn in value. Possibly it will be destroyed – if the brand deems that a better option than to discount its offerings. But, another factor to be contended with is this – what is the future of the vineyards that are growing the fruit for this now less-desirable product?
In Europe, the president of the German winegrowers association, Klaus Schneider, estimates that 30,000 hectares – one third of the country’s vine surface – should be eradicated with “in the near future.” Other renowned regions are affected too. The California Association of Winegrape Growers reckons that up to 15,000 hectares of wine-producing vines – 8% of the state’s total – were ripped out in the last couple of years. Further comments in the industry suggest that as much as 20% of fruit from 2025 was left on the vine, including top Napa Valley sites.
The French Ministry of Agriculture is frantically mounting a major rescue plan to address the financial strain on growers. Key elements include a plan to fund the removal of vineyards, targeting around 32,000 hectares (roughly 4% of French vineyards) with a specific focus on the Bordeaux region. As well as aid for farmers, a Voluntary Permanent Abandonment scheme incentivises permanent removal of vines. The European Union has weighed in as well – as of February 2026, has released €40 million from its agricultural reserve for “crisis distillation” – turning surplus wine into industrial alcohol for perfumes or sanitisers.
It is common knowledge in the industry that many of New Zealand’s vineyards produced more crop than could be used last year. The NZ Herald reported in February that around 100,000 tonnes – roughly a fifth of the potential national crop – was left unpicked. As one top winemaker remarked to WineFolio this year: “We don’t need another vineyard – there’s already an oversupply situation”.
Across the ditch, in November last year, Riverland Wine issued an urgent open letter to South Australian Premier Peter Malinauskas, warning that the state’s largest wine-producing area is in the grip of a severe economic and social crisis. The region, known as the “engine room” of Australian wine, has had a long-term oversupply of grapes – red varietals in particular – and has Shiraz prices as low as $80 – $120 per tonne – falling below the cost of growing them.
Mega-producer, Winemasters South Australia Pty Ltd in Monash is the first major company to have entered administration. Local politician, Nicola Centofanti commented that the situation is “yet another stark reminder of the crisis gripping the wine industry. Our growers are crying out for access to concessional loans so they can exit with dignity and transition to other crops”.
Unfortunately, it is probable that, again, old vines, are likely casualties. We’re back to the situation there was in 1985 when the South Australian Government sought the removal of vines in the Barossa – and 100-year old Syrah and Grenache vines were dug up. Looking back on that now, that hastily-conceived legislation looks irresponsible – but how different is the predicament today?
