High-end California wineries are disposing of their wine glut by selling premium wines to Costco, Kroger and Aldi, the Los Angeles Times reports. Of course, the wines are sold under the store's brand name, not the winery's, because the lower price at the mass retailers would hurt the brand's high-end image.

The result: At Kroger, which used to have no wines with 90-plus scores from reputable reviewers, the chain now has 20, said Curtis Mann. At Grocery Outlet Inc. a bottle that might sell for $45 to $85 is on the shelf for $9.99 as a Second Cheapest Wine, the chain's private label.

The reason, of course, is the wine glut. And the retail buyers believe it's a long way from being over.

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California wine glut sends premium bottles to Costco, Aldi and Kroger at bargain prices

By Judy LagrouOct. 7, 2026 6:48 AM PT

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Oenophiles on beer budgets have never had it better.

In California, which produces about 80% of U.S. wine, some vintners stuck with more than people want to drink are offloading their surplus, much of it high quality. That means premium wines are increasingly within affordable reach on shelves at retailers including Costco, Kroger and Aldi.

A bottle that can command $150 as a winery brand may be going for less than $30 under a private or exclusive label, according to industry buyers. Those are wines bottled for retailers to sell under their own designations, such as Costco Wholesale Corp.’s Kirkland Signature.

At Kroger Co., the largest U.S. grocer, the trajectory has been significant, and it’s showing up in wine ratings.

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“We went from having no wines with 90-plus scores in our portfolio from respectable reviewers to 20 in the last two months,” said Curtis Mann, the company’s vice president of wine, beer and spirits.

Steve Beckner, direct import and private label wine buyer for Grocery Outlet Inc., said he has never encountered anything like it in his nearly 30 years in the business.

“I’m trying to find the words to describe it,” he said. “The quality has gone up exponentially.”

A Napa Valley cabernet sauvignon that Beckner said could fetch from $45 to $85 under a winemaker’s name is priced as low as $9.99 as a Second Cheapest Wine, the private label of the chain, which has more than 500 stores in 16 states.

The reason is a supply-demand mismatch that has been building as consumption has slowed. When he started at Grocery Outlet in 2018, Beckner said he fielded offers to buy in bulk for around 1,000 to 3,000 cases at a time. Now offers are for from 20,000 to 200,000 cases, he said.

Happily for consumers, this glut is far from over.

While the industry has taken “drastic, necessary actions” to fix the imbalance, “the residual overproduction from prior years still must be worked through,” Turrentine Brokerage wrote in its August 2026 wine market report.

“I would not want to be a grower right now,” said Taylor Case, president of Navigator Wine Collection, which buys from vineyards and sells under private labels including Gearbox, Motif and Decoded. “There’s a ton of wine that’s still on the market.”

Case said he recently tasted a Napa Valley cabernet that he knows retails for $149. Navigator will sell it for $29.99, he said. “I’m shocked at what we do sometimes.”

Wineries with too much product may unload their excess in what’s called a branded closeout or sell it in bulk to be bottled by others, including grocers and retailers like Total Wine & More. Wine with no takers may sit in storage, be blended into later releases or be destroyed.

Private labels often don’t disclose the source. “If you’re a winery with a $100 cab and had to sell some of your wine that didn’t make it into the flagship, and that’s going into something that’s $9.99, you want to be discreet about it,” Beckner said.

A number of factors are cited for the overhang in California and other U.S. wine regions, including people cutting down on alcohol, side effects of GLP-1 weight-loss drugs and inflation.

This is “probably one of the best times I’ve seen in my near 30-year history in the industry for the consumer,” said Peter Baedeker, owner of Baedeker Wine, a Santa Barbara-based consulting firm.