On the supply side, the 2025 harvest is estimated at 47–47.4 million hl with good/excellent quality and high cellar stocks (~37 million hl): a “precarious equilibrium” scenario in which protecting profitability is more important than maximizing volumes.
Global demand slowing, US tariffs at 15% compressing margins, Italian large-scale retail trade holding up in value but losing in volume.
Key points of the week
- Cavit (Trentino) : Message to suppliers — possible reductions in remuneration due to pressure on costs and profitability; declining international demand, US tariffs = ~$1 per shelf on wines priced at $14–$15. First half of 2025: -6–10% in various markets; sparkling wines 7.6% . Strategy: pass 10% on to consumers, 5% absorbed by the supply chain.
- Italian exports H1 2025 (Istat) : -0.4% value , -3.1% volume (~1 billion l). USA and Canada growing ; declines in Germany, UK, Russia, Asia (China, Japan) . Sparkling wines : value -0.4% (€1 billion), volume 0.1% (254.1 million l).
- Tre Bicchieri/Gambero Rosso : H1 2025 -0.48% value (€3.86 billion) ; volumes -3.2% . Prosecco Dop : volumes 3.9%, value 1.3% (€836 million) but lower mix ; Asti declines (quantity -16%, value -12%) in Russia. Bottles <2 l: values stable, volumes -3%.
- Large-scale retail trade in Italy (Circana) : last 12 months -0.7% value (€1.88 billion) , -2.5% volume (427.8 million litres) . Formats: 0.75 litre -0.9% (but 80% of the value, €1.4%), large bottles -7.7% , bricks -5.4% , bag-in-box 2.5% .
- US tariffs and prices : companies absorb the impact ; average price -13.5% in July (from $6.52 to $5.64/l). Tariff costs for Italy: $61 million in three months , just below France ($62.5 million).
- Regional export geography (H1 2025): Veneto leader €1.4 billion (1.5%, 37.1% of the total). Tuscany follows with €588 million (~-1%) , Piedmont with €553 million (-2.2%) . Lombardy (9.1%) , Friuli Venezia Giulia (15.2%) , Puglia (5.7%) , and Sicily (4.8%) are growing.
- China : Italy at €33.6 million (-21.7%) ; overall Chinese imports to restart in 2024, but sentiment with Italian wine remains weak ; the spotlight is on the Vinitaly China Roadshow .
- 2025 production : Italy expected to be #1 in the world (~ 47–47.4 million hl , 8% over 2024). Driven by the South (19%) ; Central Italy -3% (Tuscany -13%). Good/excellent quality, but risk of price pressure from high inventories.
- Climate & Policy : Supply chain divided over uprooting , yield reduction , plant permit management, and supply chain agreement (hypothesis of lower Ho.Re.Ca. markups versus rising restaurant costs). Convergence on extraordinary promotions (primarily in the USA) and on quality as a defensive lever.
Main markets (H1 2025)
- USA : €988 million (5.2%) , L179–180 million (1.1%) ; ongoing tariff impact, signs of slowdown in Q2 (Apr-Jun -1/-2%).
- Germany : €573 million (-1.8%) , 234.5 million l (-7.4%) .
- UK : €370 million (-4.5%) , €118 million (-2.1%) .
- Canada : €198 million (12.8%) , 34.9 million l (6.6%) .
- Switzerland : €195 million (0.4%) .
- France : €158 million (1.8/1.9%) .
- Russia : €75.6 million (-37.5%) , volumes halved; Prosecco -30% .
- Japan : €87–88 million (-7.4/7.5%) .
- China : €33.6 million (-21/22%) .
- Brazil : €18.6 million (5.5%) ; under special observation.
- Vietnam : €6.1 million (16%) .
Strategic reading (for wineries, consortia, investors)
- Profitability under pressure : tariffs, mix-downs, cost inflation and more moderate consumption are pushing us to reduce yields , reposition price lists and tighten promotional controls (avoiding “blind” discounts that erode brands).
- Portfolio shift : sparkling wines still resilient , but no longer the automatic locomotive; fresh whites and fast-moving denominations perform better than structured reds in large-scale retail outlets.
- Channels : Large-scale retail trade maintains value; bag-in-box growth: opportunities for “quality BIB” lines. On-trade must be revitalized with targeted policies and staff training.
- Geographies : The USA remains core but requires surgical pricing and anti-tariff plans (hedging, long-term contracts, co-promotions with distributors). Canada and Brazil are developing; Russia and China must be managed with selective tactics and B2B/B2C education projects. Northern EU is cooling: work on value/service .
- Supply : abundant harvest, high stocks ⇒ manage volumes (scheduled bulk sales, technical distillations where available, deferred bottling, selective private label only if it protects margins).
- Communication : telling the story of origin, sustainability, and conscious moderation ; less “extravagance,” more authenticity and accessibility .
Operational moves (next steps)
- US plans : simulate scenarios with 15% tariffs over 12 months; define absorption splits between supply chain and shelf; promotional contracts with anti-speculation clauses on pre-tax stocks.
- Mix & yields : for DOC/DOCG with price tension, evaluate a 10–20% yield cut and block excess spillovers on IGP where sustainable.
- Format portfolio : push premium 0.75L with perceived value; manage quality BIBs ; reduce unprofitable bottles/bricks.
- Market diversification : maintain US/Canada share; task force on Brazil/Vietnam ; B2B education projects in China (targeted roadshows, pairings with local Italian cuisine).
- Targeted Capex : Invest in cellar efficiency and commercial data analytics ; delay non-critical expenses.
- Supply chain agreement : collaboration with distribution and catering for sustainable markups and promotional scheduling; public-private co-branding campaigns.
TL;DR
Italy is #1 for 2025 production and high quality, but with full inventories and slower demand . US tariffs are compressing margins; large-scale retail trade is holding up in value, but volumes are declining ; Veneto is the export powerhouse. The key: protect margins with lower yields, a smart product mix, and targeted promotion in growing markets (USA, Canada, and Brazil), while the Chinese bet is rekindled with education projects.
