How the Wine Industry is Reacting and Adapting in Response to COVID-19

Between the shuttering of bars and restaurants, everyone in self-quarantine having virtual happy hours and the vineyards being unstaffed, the wine industry is in a very strange place. Wine sales have been an understandable roller coaster – retail is booming but with restaurants closed the wholesale market is down. And then you have the vines, which are still going and growing despite not having anyone available to harvest them should the moment arise.

So, what exactly are the winemakers of the world doing and thinking right now? Well, it varies. 

According to Nielsen, off-premise wine dollar sales in aggregate measured channels are +31 percent, so many wineries that were previously a wholesale focused or bottle-only operation are pushing to release their wine in cans to help support their off-site sales.

Others are scrambling to partner with wine e-commerce opportunities as online alcohol retail has skyrocketed to +441 percent year-over-year.

Some are still focused on serving their wholesale partners, albeit in fewer quantities, as bars and restaurants push cocktails and wine-to-go options to beef up their takeout appeal.

There are wineries and wine-bars of varying sizes experimenting with virtual wine-tasting experiences.

European winemakers with a surplus in their store rooms are likely going to have to distill the excess wine down into industrial alcohol so as not to let it go to waste completely. It’s called “crisis distillation” and it is a decision that actually needs EU government approval to move forward. While ‘crisis distillation’ is a last resort, it actually has two large benefits: 1) it gives wine growers/winemakers some source of revenue from the excess product and 2) the alcohol produced can be used to manufacture hydroalcoholic gel, also known as hand sanitizer.

Then there are stateside wineries and distilleries that have already turned their focus to hand sanitizer. From the macro to micro operations, the alcoholic beneverage industry has mobilized — shifting their operations, sourcing other key ingredients and acquiring the necessary government approvals.

The Alcohol and Tobacco Tax and Trade Bureau has waived provisions of internal revenue law to authorize production of ethanol-based hand sanitizers by permitted distillers. The World Health Organization has released a recipe for high-quality hand sanitizer. And essential manufacturers such as Skolnik Industries are still working hard, manufacturing the carbon steel drums with food grade lining that distillers and winemakers regularly depend on for their typical product, and their new foray into hand sanitizer production.

Times are strange and uncertain for all industries and individuals right now, but we at Skolnik hope that we can continue to provide the partnership, support and supplies, including stainless steel wine barrels, that our beverage partners need, no matter how they might need to adapt their operations.