Portugal’s wine surplus intensifies pressure on Douro grape growers

Harvest begins under the weight of excess stocks

Portugal’s wine industry is confronting a persistent imbalance between production and demand as a new harvest gets under way. Estimates published by the Institute of Vine and Wine, or IVV, point to national output of 6.2 million hectolitres in the 2025/2026 campaign, 11% below the previous season. The reduction, however, does not remove the pressure created by wine already held in the supply chain and by weaker market absorption.

Final IVV declarations subsequently placed production at 5.9 million hectolitres, a decline of 14% from 2024/2025 and 16% below the average of the preceding five campaigns. Protected Designation of Origin and Protected Geographical Indication wines represented 91% of national production. Red wine accounted for 53.9%, white wine for 39.4% and rosé for 6.7%. Despite the smaller crop, the central commercial problem remains the amount of wine available relative to what buyers are prepared to take.

Douro growers seek guaranteed outlets

That imbalance has become particularly visible in the Douro. Growers protesting in Peso da Régua demanded immediate measures to ensure that their grapes could be sold and that farmgate prices covered their work. Their proposals included allocating grapes to wine destined for distillation, which would remove part of the surplus from the beverage market while providing an outlet for fruit that might otherwise remain unsold.

Between 400 and 500 producers attended an earlier demonstration convened by the National Confederation of Agriculture, according to regional publication VivaDouro. Growers feared a third consecutive harvest marked by difficulty selling grapes or by low prices. Some had already received notices cancelling grape orders. The protesters also called for tighter checks on must and wine entering from outside the region and argued that wines sold under the Douro name should be made with Douro grapes.

Lower production does not guarantee stronger prices

The figures show why a smaller harvest alone may not restore growers’ bargaining power. Wine is a storable product, so stocks accumulated in earlier campaigns continue to compete with new production. If wineries and merchants already hold sufficient inventory, a national output decline does not automatically translate into stronger demand for newly harvested grapes. Smaller and medium-sized growers are especially exposed because they need a buyer during a narrow harvest window and have limited capacity to store or process grapes themselves.

Distillation can offer short-term relief by converting surplus wine into alcohol for other uses, but it does not by itself align future vineyard output with commercial demand. Guaranteed offtake could protect growers during the current harvest, while tighter origin controls could address their concerns about competition from wine or must produced elsewhere. The longer-term test for Portugal’s wine sector will be whether producers, cooperatives and merchants can reduce inventories without pushing grape prices below sustainable levels. For Douro growers, the immediate issue is more basic: securing a buyer before the harvest window closes.