- Wine has a supply and demand problem: there's too much of it.
- Growers in Australia, California, and France are ripping up vines in response.
- A significant reason is that the demand for alcohol has declined.
Shrinking demand for boozy beverages has contributed to an oversupply of wine.
Now, some farmers in Australia, California, and France are tearing up entire sections of vineyards.
Tony Townsend, a grower in South Australia, recently told Bloomberg he's destroying his 34-acre vineyard after taking care of the vines for years.
"I enjoyed being in the wine industry, but it was just economically unviable to continue this way," he told the outlet, adding that although his crop was healthy, harvesting it would've cost him $23,000.
Townsend's not alone. Reuters reported tens of millions of vines will be ripped out in Australia to address the excess supply. As of last year, the amount of extra wine in storage in Australia was equal to two years of production, the outlet said, with some going bad before it could be sold.
"It feels like an era is ending," vineyard owner Andrew Calabria of Calabria Wines in Australia told Reuters, adding: "It's hard for growers to look out the back window and see a pile of dirt instead of vines that have been there as long as they've known."
Excess supply is also impacting winemakers in Europe and the US.
Last year, the French government — famous for going to great lengths to preserve its traditional culinary products — said it would spend $216 million on destroying excess wine in an effort to save the struggling industry. Instead of being consumed, the wine would be used to create industrial alcohol for products like perfume, hand sanitizer, and cleaning solutions.
France is also subsidizing efforts by growers in Bordeaux to rip up about 10% of their vines.
The San Francisco Chronicle reported some growers in California are destroying their vineyards, with some opting to grow other crops instead.
One of the reasons behind the overproduction is simply a change in demand: People just don't drink like they used to.
Wine consumption rose in the '90s when many believed it to be associated with good health, but as Americans have drunk less and less alcohol over the past decade, production has exceeded demand, the Chronicle reported.
"People in this business took it for granted that there was always going to be growth," Jeff Bitter, president of Allied Grape Growers in California, told the outlet.