The May 2025 Ciatti Bulk Wine Report arrives at a time of critical transformation in the global wine industry, shaped by structural shifts in both supply and demand.
According to the Organisation of Vine & Wine (OIV), global wine consumption in 2024 was estimated at 214.2 million hectolitres, a 3.3% year-on-year decline and the lowest level recorded since 1961.
This sustained drop in consumption – a trend evident since 2018 – is primarily attributed to a combination of shrinking demand from China and persistently high post-pandemic inflation, which continues to erode purchasing power even as inflation rates stabilize. Additionally, rising input costs have challenged wine’s value proposition in comparison to more affordable alcoholic alternatives, compounding wine’s loss of competitiveness in many markets.
Global wine production followed a similar trajectory. The OIV estimates 2024 production at 225.8 million hectolitres, down 4.8% from the previous year and, once again, the lowest level since 1961. These low production volumes are linked not only to adverse climatic conditions but also to strategic vineyard reductions. From 2019 to 2024, the global vineyard area declined from 7.37 to 7.09 million hectares, a reflection of industry-wide belt-tightening and supply recalibration in the face of sluggish demand. However, lower harvest volumes are now exerting upward pressure on grape prices, which risks making wine even less competitive at retail level.
There are some isolated signs of consumption resilience. Only Spain and South Africa among major wine-consuming countries have shown positive growth trends. In South Africa, much of the growth has been fueled by the affordability and accessibility of entry-level bag-in-box wines, although this uptick faltered slightly in 2024 (-2.8%) amid renewed cost pressures. Encouragingly, this points to untapped growth potential across the broader African continent.
On the bulk wine market, April and early May 2025 have been marked by a notable slowdown in trading activity, triggered largely by economic uncertainty following new US import tariff announcements. The cautious mood echoes the market paralysis of 2023. Despite improved dynamics in 2024 due to tighter crop volumes, 2025 has begun sluggishly, with Spain and Chile seeing muted activity. In contrast, Australia has experienced strong buyer interest following the completion of its latest harvest.
France
- Wide availability of southern French wines, including VDF whites from IPG declassifications.
- Prices are softening and negotiable, at multi-year lows.
- High-quality wines available with strong price-to-quality value.
- Rosé sales are slow; Provencal and appellation rosés still available.
- 2025 crop outlook is healthy, prompting suppliers to clear tank space.
- Cognac expected to offer competitively-priced 2025 Ugni Blanc, suitable for various wine bases and blends.
Spain
- Bulk wine prices remain stable but elevated, slowing market activity.
- Low retail demand (exports down 7.1% YoY to February) allows buyers to delay purchases.
- Availability is good across all bulk wine categories.
- Favourable conditions for the 2025 growing season.
- Purchases are mostly small and just-in-time rather than large commitments.
- Domestic import interest has dropped after securing lower-priced volumes.
Italy
- 10% US import tariff slowed bulk market activity in April.
- Uncertainty remains with the 20% tariff suspension expiring in July.
- Flagship appellations strong – Prosecco DOC bottlings up 4%, and bulk inventory lower than 2024.
- Prices remain stable despite weaker demand.
- Spring vineyard conditions are favourable, but southern Italy faces water shortages.
California
- Bulk wine market has slowed due to weak sales domestically and internationally.
- High inventory levels; prices trending down toward ‘California’ appellation levels.
- Attractive buying opportunities available from entry-level to Coastal wines for mid-tier programs.
- Multi-year contracts are being offered.
- Sluggish wine sales have impacted the grape market, with limited contracting activity.
- Vineyards are in good condition, but final tonnage may be capped due to weak demand.
Argentina
- 2025 harvest expected at ~2.0 million metric tons, as anticipated.
- Downward pressure on bulk prices due to average harvest and high carryover stocks.
- Argentina remains globally competitive on all wine categories.
- Prices are negotiable, including for Malbec and generic wines.
- 150 million litres of generic white in stock as of April 1st.
- 10% US import tariff not yet a major issue due to soft prices.
- Currency controls lifted; peso now stable at ARS1,150/USD after initial devaluation.
Chile
- Bulk wine prices stable but expected to rise soon due to strong domestic demand and a short harvest (~25% below average).
- Limited carryover stock contributing to upward price pressure.
- International demand cautious due to firm prices and low retailer need.
- Buyers encouraged to act now before prices increase.
- Good availability across all wines and GJC (Grape Juice Concentrate).
- 2025 vintage quality looks strong.
- Efforts ongoing to manage the impact of the 10% US import tariff introduced in April.
South Africa
- 2025 harvest met expectations with high quality and broad availability.
- Rand pricing is stable and competitive, with room for negotiation on large volumes.
- Strong domestic demand for Dry White and Chenin Blanc samples.
- International export interest remains limited due to slow global wine sales.
- 10% US import tariff applies until at least 9th July.
Australia & New Zealand
- 2025 vintages yielded good-quality grapes in both countries.
- Australia sees strong domestic and international demand, aided by a weaker AUD.
- China’s return as buyer (+94M litres) lifted Australia’s exports by 6% YoY to March.
- Vinarchy formed from merger of Accolade Wines and Pernod Ricard brands (e.g., Hardys, Jacob’s Creek, Brancott Estate).
- New Zealand left fruit unharvested due to high inventories and US tariff concerns.
- Opportunities available on well-priced carryover stock in New Zealand.
Notably, inventories of generic wine are being bolstered by declassified varietal wines, a tactic meant to meet current buyer price expectations rather than indicate a renewed consumer preference for entry-level wines.
Outlook:
The 2025 bulk wine market is delicately balanced between tightened supply, economic headwinds, and evolving consumer behavior. The dual forces of structural vineyard contraction and inflationary pressure are reshaping the global wine trade. For opportunistic buyers, now may be the time to secure value across premium categories at historically accessible price points. However, the industry at large continues to navigate the difficult terrain of supply-demand rebalance, changing consumer trends, and economic volatility.
Source: Ciatti