Oregon wine industry continues to grow, according to study
Oregon’s wine industry has experienced explosive growth in recent years with a continued focus on higher-priced, higher-quality wines, according to the latest economic impact study from Full Glass Research.
The Oregon Wine Board and Oregon Winegrowers Association first commissioned a series of reports in 2005 to reflect jobs, wages and revenue tied to wine production and distribution. The latest three-year update for 2016 was released March 19, showing gains across the board compared to 2013.
Three figures in particular tell the story. The overall value of wine-related activity in Oregon was $5.61 billion, a 67 percent increase. That includes winery and grower revenues, wholesale and retail wine sales, and related industries such as trucking and professional services.
Wine jobs also increased 74 percent, from 17,099 to 29,738, with wages topping $1 billion. To top it all off, the number of tourists visiting Oregon wineries more than doubled over the course of three years, from 1.8 million people to 3.3 million people.
Tourism related to Oregon wine accounted for $787 million in spending versus $295 million in 2013, covering hotel stays, food, entertainment and retail — a whopping 167 percent increase.
Sally Murdoch, spokeswoman for the Oregon Wine Board, said even they were surprised to see big the gains were.
“It’s emblematic of the hard work our growers are putting in day in and day out that we see this growth,” Murdoch said. “They don’t cut corners, most everything is crafted by hand, especially with our small- to medium-size producers which make up the bulk of our state’s wineries, and people who go to tasting rooms often are treated to talking with the winemakers working the land themselves.”
Other numbers in the study show wine grape acreage is up 27 percent in Oregon, and the value of grapes in the vineyard has risen from $128 million to $167 million, or about 30 percent. Winery revenues, meanwhile, are up 46 percent.
Full Glass Research is an independent market research company run by Christian Miller, of Berkeley, Calif., specializing in the craft food and beverage industries. By maintaining their focus on premium wines — highlighted by the state’s flagship variety, Pinot Noir — Miller said Oregon winegrowers have managed to turn their lower yields and cooler climate into an asset.
At the same time, Miller said the market is shifting in that same direction, with sales of over-$15 bottles of wine growing faster than under-$15 bottles for nine out of the last 10 years.
Factor in the growing tourism, and Miller said the value of Oregon wine is poised to increase exponentially. But maintaining long-term success won’t be easy, he cautioned.
“It’s not like the first premium wine boom in the 90s, where if you had a good wine you could put it out there and it would sell itself,” Miller said. “You really have to invest in sales and marketing in one channel or another to succeed.”
That is where Murdoch said the Oregon Winegrowers Association and Wine Board come into play, raising the profile of Oregon wine across the country. Last year, the association received a $174,540 specialty crop block grant from the USDA and Oregon Department of Agriculture for market outreach in major cities over the next three years.
The first event is scheduled for April 24 in Los Angeles, featuring more than 50 Oregon winemakers.
“This event will be an immersive Oregon experience and our hope is that LA’s wine enthusiasts will fall in love with what we’re making and pouring,” Murdoch said.
Oregon has grown its out-of-state wine sales over the last decade, from 888,000 cases in 2006 to 1.86 million cases in 2016. Direct-to-consumer sales, which can also include mailing customers outside Oregon, have also grown from 399,000 cases to 593,000 cases.
Miller, with Full Glass Research, said the short-term outlook for Oregon wine is positive, with factors such as demand for higher quality wines playing in the industry’s favor.
“All of that has aligned pretty well for Oregon over the next few years,” he said.