California’s wine industry is facing one of its bleakest periods in generations, with wineries, grape growers and larger producers confronting weaker demand and rising economic pressure. The strain has placed businesses across the state at risk as owners consider removing vineyards or pursuing other crops.
McManis Family Vineyards, a family-run business founded in 1990 in the northern San Joaquin Valley, has put its winery and associated vineyards on the market amid worsening conditions. The company operates mainly around Ripon, Clarksburg and Lodi and has received California Green Medals for sustainability and community work.
According to the Sacramento Bee, McManis exports to Canada fell about 95%, from 75,000 cases to 1,000 cases between July 2025 and July 2026. McManis declined to be interviewed for the SFGATE article.
The Wine Institute said Canadian restrictions cost California wine makers $357 million in 2025, with losses continuing into 2026. Canada had previously been the leading destination for California bottled wine, according to UC Davis agricultural and resource economics professor Dan Sumner.
Sumner said tariffs and retaliatory trade barriers have increased costs while putting downward pressure on wine prices.
“Tariffs raise many input costs and also lower wine prices because retaliation causes retaliatory trade barriers. Canada used to be the top destination for California bottled wine, but that ended 20 months ago with the threats and talk about the 51st state,” said Dan Sumner, an agricultural and resource economics professor at UC Davis.
Sumner compared the current downturn with earlier crises, including Prohibition and the Great Depression, while stressing that the present conditions remain unusually severe for the industry.
“Let’s be clear here — in the U.S., we went through a massive temperance movement that led to a Constitutional amendment, and the Great Depression wasn’t great in general, even though alcohol was made available for people again,” explained Dan Sumner, an agricultural and resource economics professor at UC Davis.
He said available data does not yet show that the downturn has ended, noting that economic indicators can lag behind changes in the market.
“This is a really bad one,” continued Dan Sumner, an agricultural and resource economics professor at UC Davis.
“It certainly is. And I will say, anyone [who] will say it’s at the end and it’s turned around isn’t speaking from data. We don’t have any real evidence. Data tends to lag what’s happening,” continued Dan Sumner, an agricultural and resource economics professor at UC Davis.
Jon Maramarco, a managing partner at alcohol industry data firm bw166, said the industry benefited from strong growth between 1993 and 2017 to 2018, when wine expanded faster than beer and spirits.
“We lived through a great time from 1993 through 2017 to 2018 where we saw wine grow faster than beer and spirits,” said Jon Maramarco, a managing partner at bw166.
Maramarco said baby boomers helped drive wine’s expansion during the 1990s but are now aging out of the market. He also said the industry has struggled to replace those consumers with younger generations.
“To be honest, we haven’t done enough to supplement core drinkers with subsequent generations,” explained Jon Maramarco, a managing partner at bw166.
He pointed to broader changes in household routines and discretionary spending as additional pressures on wine consumption.
“A whole lot of things have changed in the environment. It’s far harder to replicate how people started to consume wine,” said Jon Maramarco, a managing partner at bw166.
Maramarco cited the decline of traditional weeknight family dinners as one example of changing consumption patterns, alongside the growing demands placed on families by youth sports.
“We used to joke, ‘How do you have wine with meatloaf on Tuesday?’ But now, you don’t see that family dinner near as much. Take youth sports and the demand that youth sports puts on family and time, running around to practice and teams, etc. It’s disrupted the traditional family dinner most weeknights, and that’s just one example,” said Jon Maramarco, a managing partner at bw166.
Maramarco described the industry as declining rather than disappearing and said producers need to find ways to encourage more frequent consumption among new consumers.
“The business, he said “is not dying, but unfortunately, it’s in a decline. How do we get people to strata to adopt patterns of more frequency?” said Jon Maramarco, a managing partner at bw166.
In Paso Robles, real estate agent David Crabtree said the wine economy has transformed the region since he began selling ranches and wineries there in 1990. He described the area as having evolved from a stopping point into a destination supported by wine, food and entertainment.
“It transitioned from growing the grapes, to making the wine, and then you started to see some of the corporate players coming into the region,” told David Crabtree, a San Luis Obispo County-based real estate agent.
Crabtree said boutique wineries helped attract broader interest in Paso Robles, while food and entertainment developed alongside the wine industry. The shift also brought a different group of buyers to the region than he encountered when he started working there.
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