Wine News Oregon Wine Industry Continues to Grow

Oregon Wine Industry Continues to Grow

Production, plantings and sales are all heading in the right direction for Oregon.
© Oregon Wine Country | Production, plantings and sales are all heading in the right direction for Oregon.
The Pinot powerhouse is doing well in the domestic market, but exports make up a tiny percentage of production.
By Wine-Searcher staff | Posted Tuesday, 22-Sep-2020

Despite the turbulent conditions this year, the Oregon wine industry can at least revel in the fact that – apart from Covid, and the recession and the wildfires – it appears to be in robust health.

The latest figures released by the Oregon Wine Board in its annual Vineyard and Winery report show a thriving industry enjoying a period of growth across a number of fronts – but it struggles beyond its own borders.

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Sales of Oregon wine were up almost 13 percent in 2019 over 2018, and jumped by 1 million cases over a two-year period, from 3.6 million in 2017 to 4.6 million cases sold in 2019.

Value of grape production rose almost 14 percent, up to $237 million in 2019, a number that crested the $200 million mark only one year ago. Leading that rise was Oregon's main crop, Pinot Noir, which rose from $135 million to $159 million in 2019, for a healthy increase of 18 percent.

Additionally, the weight of grapes crushed by wineries in Oregon rose 6.2 percent to 84,590 tons in 2019.

More grapes came from extended vineyard plantings, with total planted acreage increasing by nearly 1500 acres from 35,972 to 37,399 – an increase of 4 percent. The highest growth rate in planted acreage was seen in the Rogue Valley at 5.2 percent. However, growth in planted acreage was slightly down compared to 5.8 percent growth seen in 2018.

Pinot Noir accounted for 59 percent of all planted acreage and 58 percent of wine grape production. As mentioned above, Oregon's largest grape variety's crop value rose by $24 million or 17.7 percent in 2019. Although still a less commonly-planted variety, Gamay Noir plantings rose 11 percent from the year prior to 128 planted acres, and Chardonnay, Malbec, and Pinot Blanc all rose by 7 percent. Albariño, a variety being measured for the first time as of last year, was up 6 percent in planted acreage for 2019.

Glitch in the matrix

However, for all the growth there was one small setback – consumer interest in Oregon wine appears to have peaked, looking at Wine-Searcher's search data. Search numbers were flat across 2015 and 2016 before getting a 6 percent bump in 2017, followed by a sharp boost in 2018, when searches rose by 23 percent and broke the 1 million mark for the first time.

Last year that growth was slower, with Oregon notching up a 9 percent increase in searches and, based on search data so far this year, that figure is likely to go backwards this year. The vast majority of those searches came from within the US, too, which might explain why export volumes of Oregon wine only amount to 2.5 percent of production. The number of cases shipped outside the US increased by more than 10 percent, albeit from a small base – from 104,477 cases exported in 2018 to 115,434 in 2019.

However, everything else is looking good. Overall wine sales enjoyed a bump in 2019 across a number of channels, showing an increasing demand. Increased case volumes also reflect broader availability for Oregon wines confirmed by Nielsen, the report said.

Over the past 12 months, including more than five months of reporting since the pandemic, Nielsen store data suggests that Oregon wine sales are up 19 percent compared to overall wine category sales growth of 12 percent. Sovos ShipCompliant's report showed an increase of 9 percent in Oregon wine shipped direct to consumers, and the IPRE numbers hovered around the same amount with wholesale sales up 13 percent and tasting room sales up 11 percent.

Oregon Wine Board President Tom Danowski said: "Many grape growers and winemakers benefited last year as Oregon wines filled distribution gaps and continued to sell through well where they were already available. Retailers, restaurateurs and fine wine consumers all continue to recognize the exceptional quality and value propositions these wines represent. It is especially encouraging to see consumer takeaway of Oregon wines trending ahead of the industry's growth averages since the pandemic disrupted restaurants and winery tasting rooms."

Wineries in Oregon now number 908 and vineyards saw a healthy increase of 11 percent to 1297 throughout the state.

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