Argentina’s Wine Industry Suffers Sharpest Decline in Over 15 Years as Consumption and Exports Plummet

Argentina’s wine industry is facing its most severe downturn in more than 15 years, as domestic consumption has dropped to historic lows and exports continue to decline. The crisis comes at a time when the country’s wine sector, once a symbol of national pride and economic strength, is struggling with changing consumer habits, rising production costs, and international competition.

In Mendoza, the center of Argentina’s wine production, hundreds of people gathered last week for the annual National Wine Harvest Festival. The event, now in its 90th year, featured music, dance performances, and the election of the festival queen. Despite the festive atmosphere, the mood among producers was somber. According to the National Institute of Viticulture (INV), wine consumption in Argentina fell to 15.7 liters per person in 2025. This is a dramatic drop from 1970, when annual per capita consumption reached 90 liters.

The decline in domestic demand has had a direct impact on the industry. Over the past year, 1,100 vineyards have closed across Argentina. The country has also lost 3,276 hectares of grape production. Fabián Ruggieri, president of the Argentine Wine Corporation trade group, said that the main cause is a sharp decline in purchasing power that began in 2023. He explained that middle- and low-income consumers—traditionally daily wine drinkers—have been hit hardest by inflation and economic instability.

Federico Gambetta, director of Altos Las Hormigas winery in Mendoza, said that shifting consumer preferences are also playing a role. He noted that younger generations are less interested in traditional high-alcohol red wines and are instead seeking lighter styles such as whites and rosés. “People no longer consume wine en masse,” Gambetta said. “They want coherence and purpose behind their purchase.” His winery began adjusting its production style in 2010 to appeal to these new tastes.

The trend is not unique to Argentina. In the United States, wine consumption is also falling among younger adults. A report from Silicon Valley Bank found that millennials and Gen Z are drinking less alcohol overall and are more likely to choose beverages other than wine.

On the export front, Argentina’s position as the world’s 11th largest wine exporter has not shielded it from difficulties. In 2025, exports dropped to 193 million liters—a 6.8% decrease from the previous year and the lowest level since 2004. Ruggieri pointed out that Argentine producers face high logistics costs and external tariffs that make their wines less competitive abroad. While neighboring Chile benefits from free trade agreements with over 60 countries—including China—Argentina faces tariffs ranging from 10% to 20% in most markets.

Gabriel Dvoskin owns Canopus winery in Mendoza’s Uco Valley and produces about 50,000 bottles annually for export to 15 countries, with the United States as his main market. He said inflation has made it difficult for Argentine producers to compete internationally because input costs for bottles and corks are much higher than those faced by European wineries. “Our inflation makes us a bit expensive,” Dvoskin said.

Producers say that maintaining quality is essential for survival in this environment. Gambetta emphasized that one mistake can be fatal for a winery given current conditions: “Right now everything is very delicate, and one wrong step can bankrupt you.”

Despite these challenges, events like Mendoza’s harvest festival show that there is still enthusiasm for Argentine wine among locals and tourists alike. However, unless economic conditions improve and producers can adapt to new consumer trends at home and abroad, many fear that more vineyards will close and Argentina’s reputation as a leading wine producer could be at risk.