California Wineries Continue to Struggle in 2025

The wine sector—long considered a steady pillar of agricultural value—is facing a cascade of interlocking pressures: falling demand, over-supply, vineyard removal, and volatile global trade.

Recent reports highlight how growers, especially in key regions such as California, are being forced into hard decisions.

California’s wine-grape sector has become emblematic of the turmoil. California growers ripped out nearly 40,000 acres of vineyards -- which is approximately 7% of the state’s planted acres—between October 2024 and August 2025, according to the San Francisco Chronicle. 

The removal followed two consecutive weak years. The state’s wine industry suffered a 23% drop in the 2024 harvest compared with 2023, and growers left thousands of tons of grapes unharvested as wineries struggled to find buyers.

Some California Vineyards Left Unharvested

Some wine growers are not selling their grapes, but they aren’t ripping them out either. Tens of thousands of acres of wine grapes got left behind…abandoned, Jeff Bitter, president of Allied Grape Growers in Fresno, explained in this Fertilizer Daily article. 

“Between the removals and the literally tens of thousands of acres that are not producing that were producing … the biggest wild card is going to be how many grapes go unharvested,” Bitter said.

RELATED: “The unfortunate truth is that younger people, for the most part, are not interested in wine, and the industry has not done enough to entice them into becoming regular consumers. By some industry projections, sales of American wine could fall by about twenty percent in the next decade. It’s clear that something must be done to reach younger drinkers,” Beverage Insider reported last October about the potential troubles ahead for the wine industry. 

Wine Exports Fall

President Donald Trump’s tariffs may be slowing the pour of U.S. wines across the rest of the world. Wine exports had dropped 28% through July of this year, according to Vinetur. 

The decline is more substantial in Canada and more complicated, too. Earlier this year, Canada responded to Trump’s global trade war by removing wine from the country’s government-controlled liquor store shelves.

Trump had ordered 25% tariffs in March on some Canadian imports. As he frequently does, Trump then amended his action. He exempted goods that were part of the United States-Mexico- Canada (USMCA) Trade Agreement.  

The two countries eventually reached a truce, of sorts, in September and lifted their tariffs. However, some Canadian provinces did not. Those included British Columbia, Ontario, and Quebec.

As a result of Trump’s trade policy, U.S. wine exports to Canada plummeted 91% this year compared to last year, according to Vinetur. That turned what had been a trade surplus into a $51.5 million trade deficit for U.S. producers.

Vinetur laid out what could be a workaround that benefits Canada to avoid the Trump tariffs:

“Another issue raised by the industry groups is the rise in bulk wine imports from Canada into the United States. According to data from the International Organization of Vine and Wine (OIV), nearly all Canadian wine exports are actually re-exports of bulk wine from other countries, with most destined for the U.S. market. The groups question whether these imports should qualify for USMCA tariff preferences or be allowed under existing mutual acceptance agreements.”

RELATED: This California winemaker explained to American Farmland Owner what he is doing to increase interest in wine with younger consumers.