San Juan Wine Shipments Plunge 54.6%

The global wine industry is facing one of its most challenging periods in recent decades. In France, a country long seen as a symbol of wine culture, the government has authorized programs to uproot thousands of hectares of vineyards. This measure, aimed at reducing oversupply and stabilizing prices, comes as French producers struggle with falling domestic consumption, increased competition from other beverages, and large stocks that cannot be sold. The decision to pay growers to remove vines in regions like Bordeaux and Languedoc marks a significant shift for an industry that has traditionally focused on expansion and prestige.

This crisis is not limited to Europe. In Argentina, the effects are being felt strongly in the main wine-producing provinces of Mendoza and San Juan. Mendoza remains the center of Argentina’s wine business, accounting for 90.7% of domestic shipments in November 2025. However, even this dominant position is showing signs of strain. Consumption per capita is declining, profit margins are shrinking, and small wineries and primary producers are struggling to cover their costs. Large wineries have also reported serious financial difficulties in recent months. While Mendoza’s size and diversified production have helped it weather the storm better than other regions, it is not immune to the broader downturn affecting the industry.

San Juan, Argentina’s second most important wine-producing province, is experiencing a much sharper decline. In November 2025, San Juan shipped just 33,068 hectoliters to the domestic market—a drop of 54.6% compared to the previous year. This marked the eighth consecutive month of falling sales for the province, far exceeding the national average decline of 12.5% for the same period. From January to November 2025, San Juan’s total shipments fell by 22.6% compared to the same period in 2024. The biggest losses were seen in non-varietal red wines, which dropped by 29%, followed by white varietals at nearly 20%.

The structure of San Juan’s wine market helps explain its vulnerability. The majority of its sales—72.9%—are packaged in tetra-brick containers, which are typically associated with mass-market consumption. Bottled wines account for 24.1%, while traditional demijohns make up just 3%. As consumers’ purchasing power declines, demand for these lower-priced products has fallen sharply, eroding San Juan’s market base. Although it remains the second-largest province for domestic wine shipments, its share dropped to just 5.3% in November 2025—a figure that continues to fall.

The situation in San Juan highlights a deeper shift in both consumption patterns and business models within the wine industry. The sustained monthly declines and sharp year-over-year drops suggest more than just a temporary setback; they point to structural changes that require adaptation from producers and policymakers alike.

Globally, vineyard acreage has decreased by 7.1% through 2024 as countries respond to falling demand and changing consumer habits. In San Juan, local authorities are looking for ways to adapt by shifting focus toward other agricultural products such as raisins, table grapes, and concentrated grape must—sectors that have shown positive results even as wine exports remain minimal at around $3 million in 2025.

To support this transition, significant investment will be needed—estimated at $150 million—to convert existing vineyards for alternative uses and increase productivity without expanding cultivated land due to ongoing water shortages.

As traditional markets contract and new challenges emerge, both established producers like France and key regions such as Mendoza and San Juan are being forced to rethink their strategies. The future may depend on producing less but higher-value wine, finding new markets abroad, or diversifying into other grape-based products as part of a broader effort to sustain rural economies and preserve viticultural heritage under changing global conditions.