Argentina’s once thriving wine industry is grappling with its most severe crisis in over 15 years, marked by unprecedented low domestic consumption, declining exports, and poor crop yields.
This stark reality unfolded even as hundreds of wine enthusiasts converged last week in Mendoza, the heart of the nation’s wine region, to partake in the annual National Wine Harvest Festival.
The festival, celebrating its 90th year, provided a vibrant counterpoint to the grim statistics. Domestic wine consumption in Argentina is projected to hit an all-time low of 15.7 litres (4.1 gallons) per person in 2025, according to the National Institute of Viticulture (INV).
This figure stands in stark contrast to 1970, when Argentines consumed a substantial 90 litres (24 gallons) per person annually. The crisis has already led to the closure of 1,100 vineyards nationwide, with 3,276 hectares (8,095 acres) of grape production having vanished from the landscape.
Fabián Ruggieri, president of the Argentine Wine Corp trade group, attributes the drop largely to a “sharp decline in purchasing power” that began in 2023. This trend, he said, is most acute among middle- and low-income consumers who traditionally consumed wine on a daily basis.
For Federico Gambetta, director of the Altos Las Hormigas winery, a medium-sized winery in Mendoza, the crisis is exacerbated by a shift in consumption patterns.
“People no longer consume wine en masse,” said Gambetta, noting that consumers now seek “coherence” and a sense of purpose behind their purchase.
While older generations favored high-alcohol, full-bodied wines, younger consumers prioritize other attributes, such as “approachability, freshness and lightness” — qualities typically found in white wines and rosés.
One of Gambetta’s red wines — Malbec Los Amantes 2022 — was recently ranked 41st among the world’s 100 best wines. Yet, he notes that starting in 2010 his winery began to modify its wine — once defined by a traditional, heavier profile — to appeal to a new generation of consumers seeking lighter styles.
“Everything has mutated,” Gambetta said. “If you’re not dynamic, you’re lost.”
The U.S. is experiencing a similar shift as the older wine-focused demographic ages out and younger adults fail to fill the gap. A report by Silicon Valley Bank found that millennial and Gen Z drinkers are spread across more categories and drinking less overall, particularly those under 29.
The international market offers little relief. As the world’s 11th largest wine exporter, Argentina saw its exports fall to 193 million liters (51 million gallons) in 2025 — a 6.8% year-on-year decline and the lowest volume since 2004, according to INV.
Ruggieri notes that exports are being hampered by financing issues, high logistics costs and a lack of competitiveness resulting from external tariffs. While its neighbor and wine competitor Chile enjoys free trade agreements with over 60 economies — often reaching markets like China with tariff rates close to zero — Argentina faces tariffs between 10% and 20% in most markets.
Local producers like Gabriel Dvoskin, owner of the 10-hectare Canopus winery that produces approximately 50,000 bottles of wine each year, also struggles with inflation.
Dvoskin, who exports to 15 countries, with the U.S. as his main market, acknowledges that Argentina’s high production costs and rampant inflation place his wines at a disadvantage compared with international competitors.
“Our inflation makes us a bit expensive,” Dvoskin said. “My equivalent in France has a much lower cost for dry inputs — bottles, corks, etc. — than I do.”
For Gambetta, the current crisis reinforces a key lesson for the industry: product quality is non-negotiable.
“Right now, everything is very delicate, and one wrong step can bankrupt you,” Gambetta said.
