Cheers to Growth: The Surprising Resilience of the U.S. Wine Industry

To paraphrase Mark Twain, 'the demise of the wine industry has been greatly exaggerated.' Headlines casting shadows over the U.S. wine industry have become cliché, but a newly released report offers a refreshing perspective: wine dollar sales were actually on the rise in 2023, continuing an upward trend since 2018. Spearheaded by Adam Beak, Managing Director and Head of the Wine & Spirits Vertical at BMO, the report sheds light on some remarkable insights into the market's resilience and growth.

Contrary to expectations, total wine dollar sales surged to $107 billion in 2023, marking a significant 46% increase from just over $73 billion in 2018. While inflation and price hikes have played a role, the report suggests that this growth is not solely attributable to such factors. Instead, it points to a culture of moderate wine consumption and a tendency among consumers to trade up for higher-quality offerings.

One of the most notable findings is the stability and expected growth of wines priced at more than $10 per 750ml bottle. In fact, nearly 30% of consumers reported purchasing wines priced at $20 or more on a monthly basis, indicating a growing demand for premium and luxury wine segments.  Sheetz and Wawa may want to take note.  

The 2024 BMO Wine Market Report, a groundbreaking initiative, captures 100% of wine sold in the U.S. market. Drawing upon extensive data from reliable sources such as the Bureau of Economic Analysis (BEA) and the Tax & Trade Bureau (TTB), this comprehensive analysis provides a holistic view of the industry landscape. BMO intends to publish the report annually, offering it as a complimentary service to the wine industry.

Source: BMO

With 11,600 wineries operating across all 50 states, the U.S. wine market continues to showcase its resilience and adaptability. Despite challenges, including changing consumer preferences and market dynamics, the industry remains buoyant, fueled by a combination of innovation, quality, and consumer enthusiasm.  This blog will continue to play a supportive role during the industry's transition with its increasing emphasis on premiumization.   

In conclusion, the 2024 BMO Wine Market Report serves as a beacon of optimism, reaffirming the enduring appeal of wine and the industry's capacity for innovation and growth. As we navigate the ever-changing landscape, the one thing that we can count is that Gen Z will age and gravitate towards the complexity of a Napa cab over a can of Truly.