Ste. Michelle to Trim Grape Purchases 40%

Ste. Michelle Wine Estates plans to reduce total anticipated grape supply by 40% over the next five years, and has begun negotiating with individual growers over contracts it no longer wishes to continue.

News of Ste. Michelle's cutback was delivered at a meeting with growers, according to Sean P. Sullivan, who first reported it in his Northwest Wine Report.   Also attending the meeting was Sean Conway, Ste. Michelle's new CEO who was hired in March, the company's CFO and a representative from Sycamore Partners, the private equity firm that purchased the winery in 2021.

What does a 40% reduction mean for Ste. Michelle and the industry?   In 2017, Ste. Michelle contracted with 35,000 of Washington's 50,000 acres.  A 40% reduction  means Ste. Michelle would go from using about 35,000 acres to potentially 18,000 acres in less than 10 years time.