Wine Supply Is Entering Unknown Territory

Posted: Sep 04, 2019

Today, wine supply is moving into unknown territory. We have now reached the point where we have a large and unhealthy excess in grape supply in all price segments. Creating this is a unique set of circumstances we've not experienced before.

From a demand perspective, we are seeing negative volume growth in those regions that produce wines that are positioned below $9 at retail. That's an issue that's been well documented.

More recently though, volume in higher price point regions has shown zero to minimally positive growth rates, and luckily still modest positive growth in sales dollars. On a volume basis, we are close to hitting slack. We haven't seen negative volume growth since 1994 in the business, but we are very close to that today.

By Rob McMillan
September 2, 2018
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