Wine and market: reduce supply or make demand grow? The different positions of supply chain

For some time now, with the wine market struggling compared to the past and cellar stocks in Italy (but not only there) remaining steadily high for several months (also considering the 2026 harvest that is approaching and will need to be managed in terms of volumes), a large part of the production sector and industry associations have been emphasizing the need to reduce production, in order to rebalance supply and demand and, above all, to protect wine prices at origin, which are instead declining almost everywhere. This is also being pursued by leveraging new tools introduced in recent months at the EU level through the “Wine Package” (here a summary of the main innovations introduced). However, in such a fragmented sector, made up of very different types of businesses (vertically integrated companies, covering everything from vineyard to shelf, ranging from very small operations to larger entities, as well as major bottlers and cooperatives), along with hundreds of territories and appellations experiencing different dynamics, and various types of wine, finding a shared vision or a one-size-fits-all solution is, to say the least, complex. In recent months, the main industry organizations have repeatedly expressed their views, also in view of a negotiation with institutions within the “Wine Roundtable”, which remains in the background, but where it will not be easy to reach a synthesis. There are those, for example, who call for across-the-board cuts in yields for generic wines, and those who consider such measures unsustainable for businesses which depend on volume; those who advocate for a halt or suspension of new planting authorizations (allowed up to 1% per year under EU regulations), a measure which consortia can in fact decide internally (just as they can reduce maximum yields set by production regulations, subject to approval by the relevant authorities, primarily the Regions), and those who argue that such measures would have little immediate effect and might instead penalize growth opportunities for wineries that, despite everything, are healthy and willing to invest; those who talk about possible uprooting of vineyards and those who rule out this measure, either entirely or partially. Not to mention that some, rather than investing resources and attention in reducing supply, focus on increasing demand.
This is a complex and varied scenario, on which, by reporting the different positions, we have tried to provide a sort of “the state of the art”. “The situation is complex; a very pragmatic approach is needed, and everything can be discussed. That said, as Federvini  - comments Gabriele Castelli, director general of Federvini, commenting to WineNews -  we believe that if there is indeed a situation where there is more product than the market currently requires, efforts should be concentrated on expanding markets and stimulating demand, rather than reasoning in terms of general production cuts. Moreover, for denominations, such measures already exist, from reducing yields compared to what is set by production regulations, to storage measures, and so on. Other measures, such as the suspension of authorizations for new plantings (set at a maximum of 1% per year according to European regulations), in our view would have limited effects that would in any case only be seen after 5-6 years; they wouldn’t provide immediate relief to those in difficulty and could instead limit the opportunities of those companies that are still growing despite the context. A linear cut in yields for generic wines is hardly practicable, and market trends are not the same for everyone. The same applies to another measure that is being discussed, vineyard uprooting, which is an extreme option that is nonetheless difficult to address in a generalized way at the national level. From our point of view, as mentioned, efforts and resources should be concentrated on creating new markets, which does not only mean promoting abroad using Cmo funds or similar tools, but also investing in product innovation, creating new consumption occasions, building strong brands, and so on.
Measures that must first and foremost be implemented by companies, but which consortia and supply chain organizations can support and facilitate”. A position that, moreover, is similar to that of the Government, as emerges from this interview with WineNews with Minister of Agriculture, Francesco Lollobrigida, collected in Conegliano, in the Prosecco Docg area, during the days of the Assoenologi Congress: “we are not a nation with a Government that sets five-year development plans imposing choices on the agricultural world. Italy is a diverse nation with different types of production. Here in Veneto, even talking about uprooting makes everyone bristle. Even just saying that we will not proceed with expanding production areas creates problems, because wines and products have a large market and high added value. In other areas of the country, of course, the situations are different; all must be assessed accordingly. Interventions on distillation are measures which we have evaluated, also together with trade associations, as a drop in the ocean, which would not solve the problem. They would affect minimal quantities of the product considered in excess and, obviously, would be “lost” within the year in which the funds are invested. Whereas the same amounts invested in communication and in strengthening businesses create significant advantages. I believe the market has its own rules, and therefore conditions of fairness and equality are needed, these are what we must guarantee. Then, those who are more capable manage to position themselves on the market, within a framework in which companies that have been able to act collectively, improve efficiency, reduce production costs, and open new paths to create added value not only hold their ground but are in excellent condition. Those, on the other hand, who have chosen a policy of standardizing low-quality products face greater difficulties. We are available to help everyone - underlines Minister Lollobrigida - but within the framework of market rules that, on their own and without impositions, tend to reduce production when it is not profitable. However, in this perspective, we must also safeguard another principle that I want to emphasize, because it is sometimes not fully understood. It is not that we, as Italy, support agriculture through the Common Agricultural Policy because it is a different kind of enterprise from commerce and industry. We support agriculture because the farmer is the custodian of the land, and vineyards generate positive spillover effects linked to cultivation. Uprooting doesn’t produce these positive effects, and therefore one can’t expect an activity which doesn’t produce to be supported through a form of welfare that, in my view, has no justification whatsoever”.
Also Unione Italiana Vini (Uiv) recently put forward its proposals in a press release, following its National Council meeting held in recent days at Rocca Sveva winery in Soave. According to the organization led by Lamberto Frescobaldi, “among the most urgent measures to address the imbalance between supply and demand, there are a temporary halt to new planting authorizations and a reduction in production yields - including for PDO and PGI wines - as well as updates to production regulations and a revision of yield limits for generic wines, with a more effective sanctioning system and stricter rules governing reclassification between denominations. According to data from the Uiv Observatory, as of April 2026 - one can still read in the note - Italian wineries recorded a 7.6% increase in stocks compared to the same period in 2025, with bulk prices for the main PDO-PGI wines declining by 7%. This market slowdown is also weighed down by performance on foreign markets: after a contraction in 2025 (-3.7% in value compared to 2024), the first quarter of 2026 also closed with extra-EU markets at -11%. The document ultimately rules out generalized vineyard uprooting plans, considered ineffective and particularly harmful for hilly and mountainous areas. In a medium- to long-term perspective, it calls for the development of a national strategic plan for the next 5-10 years, aimed at aligning production with real demand and strengthening the competitiveness of Italian wine on both domestic and international markets”.
While this represents the position of Unione Italiana Vini (Uiv), representatives of the cooperative sector have also made their voices heard, a sector which, it is worth recalling, produces more than half of Italian wine and plays a largely predominant role in some territories and denominations. According to Luca Rigotti, head of Mezzacorona and confirmed as leader of the wine sector within Confcooperative (here, our interview), “it is true that we are going through a crisis that the sector has not experienced for many years, within a broader crisis, marked by wars and more, which, among other effects, has driven up the cost of money, slowed the economy, reduced purchasing power and, consequently, wine consumption. However, I don’t believe that certain measures, such as across-the-board cuts in yields, can be applied universally. Each territory must assess, based on its production and market demand, whether such measures are appropriate. There are generic wines which depend on large volumes, for example. I believe each territory has a responsibility to manage its production, even without necessarily resorting to uprooting. There are measures which consortia or regions can adopt in coordination with the supply chain, such as storage schemes, limiting vineyard expansion for a certain period, or managing production through reduced yields, but overall I tend to think that it is up to individual areas and regions to decide what to do, because Italy has a wide variety of wine productions with significant specificities”.
Even within the cooperative world, however, views differ. According to Legacoop Agroalimentare, headed by Cristian Maretti, for example, temporarily suspending authorizations for new vineyard plantings is a “necessity”:  “each year, the current system allows for nearly 7,000 hectares of new vineyards to be planted - explained the president of Legacoop Agroalimentare in his speech - but in light of the possibility introduced by the EU “Wine Package” to reduce authorizations even to 0%, the Coordination considers it urgent to evaluate a temporary suspension of new authorizations in order to avoid further increasing supply in a market phase already marked by potential imbalances between demand and production”. According to the National Association of Agro-Fishery-Food Cooperatives affiliated with Legacoop (which includes more than 60 wine enterprises, representing production worth 2 billion euros, nearly 13% of Italian wine turnover, with 620 million euros in exports and over 2,700 employees), reducing yields is not enough: a clearer and more detailed picture of stocks is needed, as these vary widely depending on product categories, types, and territories. A uniform assessment, Legacoop explains, would risk being ineffective, since the wine market is not a single entity but a collection of different segments, each with distinct dynamics and destinations. “All solutions which fail to take this level of detail into account appear, in our view, superficial and ineffective,” Maretti emphasizes. He adds that “crisis measures such as distillation and uprooting (as provided for in the “Wine Package”) shouldn’t be ruled out from the start for those areas or denominations facing structural difficulties”.
On the subject of vineyard uprooting, one of the most sensitive issues, not so much in terms of implementation (since individual companies can decide autonomously whether to proceed) but rather in terms of potential public funding, the Federazione Italiana Vignaioli Indipendenti (Fivi), headed by Rita Babini, also expressed strong opposition in recent weeks at the time of the approval of the EU “Wine Package”. According to Fivi, “including uprooting among sectoral measures, and therefore making it eligible for EU funding, is a mistake, because European funds should be used to support growth and competitiveness of companies”.
Thus, there are many different positions, more or less sharply defined, deriving from different points of view, which once again reflect a reality in which the Italian wine sector, while representing a national excellence in terms of image and communication and a driver of “widespread wealth” across many territories, is internally characterized by a great diversity not only of regions and products but also of business models. Especially in difficult market phases, holding all these elements together is not easy. Finding a synthesis, as it is often the case in politics, and even in wine policy, is a fundamental aim which requires the greatest effort to think in terms of the supply chain, setting aside, as much as possible, the legitimate interests of individual stakeholders.