Italian wine has entered a new phase in its history and can no longer afford to face it with the tools of the past. This was the strong message that emerged from the 2026 General Assembly of Unione Italiana Vini (UIV), where data, analysis and scenarios converged on a single conclusion: the sector must learn to produce less in order to preserve its value. On the table are inventories at their highest levels in recent years, slowing exports, increasingly weak international consumption and a growing phenomenon of downgrading that, according to the UIV Observatory, is already eroding more than half a billion euros in potential value every year. This scenario led Lamberto Frescobaldi, President of UIV, and Paolo Castelletti, Secretary General, to call for a profound revision of production policies, supported by a long-term strategy capable of making the sector more competitive and less exposed to geopolitical risks.
Frescobaldi (UIV): The Time for Inaction Is Over for Italian Wine
“Better a wrong decision than no decision at all.”
These words, spoken by Lamberto Frescobaldi, were destined to encapsulate the entire UIV Assembly.
The statement stems from the awareness of a structural change. According to UIV, Italian wine is not experiencing a simple cyclical downturn, but rather a new economic and geopolitical environment that requires different tools from those used in the past.
“Under current market conditions, even a harvest of 44 million hectolitres is no longer sustainable. It is time to take responsibility for courageous decisions, even if they are unpopular, because inaction is already costing the sector far more than any rebalancing measure: overproduction is impacting value and profitability throughout the supply chain. We must protect a sector worth 1.1% of GDP and one that contributes significantly not only to the trade balance (+€7.2 billion), but also to the wealth of territories and the preservation of landscapes.”
In his concluding remarks, Frescobaldi broadened the discussion further, arguing that Italian wine has entered “a new phase in history and in its own history,” characterised by geopolitical instability, trade tensions and new business dynamics in which the concept of de-risking—reducing exposure to geopolitical and commercial risks—becomes an integral part of corporate strategies.
Record Inventories and Falling Prices: The Market No Longer Absorbs Production
The figures compiled by the UIV Wine Observatory portray a situation of increasing imbalance.
In May, wine and must inventories exceeded 53 million hectolitres, up 7.3% compared with the same period in 2025: effectively the equivalent of an entire harvest still sitting in Italian cellars, the highest level since 2022 despite three consecutive harvests below average.
At the same time, consumption is slowing both domestically and internationally. In Italian large-scale retail distribution, sales between January and May declined by 2%, while in the first quarter exports fell by 4% in volume and, more importantly, by 8.3% in value, with a decline exceeding 11% in non-European markets.
The consequences are immediately reflected in the bulk wine market, which UIV considers the primary indicator of the sector’s health. During the first five months of 2026, average prices fell by 5.5% for PDO wines, 7.2% for PGI wines, and as much as 14.4% for generic wines.
One Bottle Out of Five Is Downgraded: Half a Billion Euros of Lost Value
The data that concerns Unione Italiana Vini the most relates to the increasing use of downgrading.
According to UIV Observatory calculations, in 2025 approximately 6.6 million hectolitres, equal to 20% of the PDO and PGI production potential, were reclassified into lower categories, including 4.9 million hectolitres directly downgraded to generic wine.
This strategy is often adopted by companies to facilitate the sale of inventories, but it inevitably compresses the value of the entire quality pyramid.
“It is necessary to update the regulatory framework in order to regulate and rationalise the sector: production must be planned according to market demand,” explained Secretary General Paolo Castelletti. “We have found that today one bottle out of five is downgraded, and this is a practice that risks triggering a snowball effect: wine moves down a category, volumes accumulate at the base of the quality pyramid, and prices are the first to suffer. Under the weight of excessive supply, more than half a billion euros of annual potential value has already been eroded.”
The estimates point to a total loss of €516 million, including €364 million for PDO wines and €152 million for PGI wines, equivalent respectively to value reductions of 10% and 14%.
The United States Is No Longer the Same: Italian Wine Exports Continue to Slow
If the domestic market is slowing, international markets offer little additional comfort.
During the first four months of 2026, exports to the United States declined by 15.4% in value, continuing a negative trend that had already begun in 2025.
“From April 2025 to the end of March 2026, our exports to the United States fell by 17%, representing a value gap of around €340 million,” stated Castelletti. “The idea that Americans will continue buying our products regardless of tariffs is attractive to tell, but increasingly difficult to manage in reality. For wine, tariffs have been the straw that broke the camel’s back, but we are seeing difficulties in other traditional Made in Italy sectors as well, such as food, machinery and furniture. Today, the imperative is to multiply our presence in the world’s largest market through the language of trade, not through the concerning language of politics.”
Tariffs and the weakening of the dollar are not the only factors at play. The deeper issue is a profound transformation within American society.
According to analyses presented during the Assembly, wine consumption in the United States has been declining for five consecutive years and, in the first months of 2026, fell by a further 10% across the overall market, while Italian wines limited the decline to 7.3%, supported largely by sparkling wines.
Federico Petroni, Americas Coordinator at Limes, summarised the transformation as follows:
“In the United States, it is not only a generation of consumers that is changing, but the very composition of America itself, within a structural paradigm shift of which the Trump administration is more an effect than a cause. As the Baby Boomer era declines, a country with different cultural references is emerging. For Italian wine, this means engaging audiences that can no longer be reached through the same language used in the past: new tools will be required, together with an increasing ability to speak to a more plural America, where change is simultaneously generational, ethnic and geographic.”
De-Risking Starts with Europe
For UIV, the response cannot be limited to the United States alone.
The objective is to build a de-risking strategy, reducing dependence on a limited number of markets and strengthening the role of the European Union as the principal factor of stability.
Over the past six years, Italian exports to EU countries have grown by 31%, a rate twice as high as that recorded in non-European markets. However, the potential remains constrained by significant regulatory fragmentation.
“The real cost of Europe is non-Europe,” observed Carlo Alberto Carnevale Maffè, Professor of Strategy at SDA Bocconi School of Management. “European companies bear not only the cost of internal barriers, but also that of a fragmented single market. In the agri-food sector alone, this lack of integration amounts to around €57 billion: a hidden cost that companies pay every day through duplicated procedures, non-harmonised regulations, divergent taxation systems and compliance burdens. For businesses competing globally, it is paradoxical to effectively face 27 different markets within the Union. Completing the single market is not only about simplification: it means restoring competitiveness to European companies and freeing up resources for innovation, investment and growth.”
UIV’s Proposal: Plan Production to Protect Value
Alongside its analysis of the current situation, the Assembly also presented a series of operational proposals.
Among the measures considered priorities are a temporary freeze on new planting authorisations, stronger traceability of production potential, lower yields even for PDO and PGI wines, and a national planning framework capable of adapting production to the evolution of demand, while avoiding the use of generalised grubbing-up programmes financed through OCM funds.
The guiding principle remains the one outlined by Frescobaldi: manage change rather than suffer its consequences.
Because, as emerged clearly during the Assembly, the real risk today is not making an unpopular decision, but continuing to postpone it while the value of Italian wine gradually continues to decline.
