Oregon’s grapes and wines are a $7.2 billion economic engine that has grown 27% since 2016.
PORTLAND, GOLD, February 10, 2021 – The economic contribution of Oregon’s wine industry grew significantly from 2016 to 2019, according to a new report released today by the Oregon Wine Council. The study is published every three years under the direction of Dr. Robert Eyler of Economic Forensics and Analytics, Inc. and Christian Miller, owner of Full Glass Research. The preliminary 2019 figures once again demonstrate the impressive growth achieved through the work of Oregon’s grape growers and winemakers and the layered supply, sales and distribution chains of Oregon’s wine industry. More than 1,297 Oregon winemakers produced 2019 harvests worth $237.8 million, a 14% increase. Just two years ago, that figure reached the $200 million mark, and Eyler and Miller say grapes are Oregon’s leading fruit crop.
By 2020, however, COWID-19, along with tragic fires and government policy decisions, had pushed the industry into a downward spiral.
The four most revealing growth figures are as follows:
- First, the amount of all economic activity in Oregon directly or indirectly related to wine in 2019 was $7.21 billion, compared to $5.67 billion three years earlier, a 27% increase over the state as a whole. This includes revenues from vineyards and farms, wholesale and retail wine sales, related industries such as transportation and professional services, as well as wages throughout the supply chain and the impact of workers spending those wages in Oregon.
- Second, the number of wine-related jobs in Oregon is projected to be 40 047 in 2019, compared to just under 30 000 in 2016, an increase of 35%. And wine continues to generate economic activity in each of Oregon’s 36 counties.
- The third notable result is that the wine industry generated more than $184 million in state and local tax revenue in 2019. Of this amount, $88.5 million, or 48%, came from property taxes.
- Finally, another notable figure is the impact of wine on tourism, as wineries continue to attract visitors to Oregon. In addition to the overall growth of tourism in Oregon and the increase in visitor spending, Dean Runyan Associates estimated that the total impact of tourism in Oregon increased by $1.9 billion from 2016 to 2019, an estimated increase of 17%. Through accommodations, restaurants and other activities, wine-related tourism accounted for $894 million in the state budget, excluding tasting room sales, a 13 percent increase over the $787 million spent in 2016.
In 2020, a different story will take shape. While wine-related wages exceeded $1.51 billion in 2019, compared to $1.04 billion in 2016, and have declined by 50 percent as the economy continues to recover from the Great Recession (2008-10), researchers estimate that pandemic and natural disasters will push wages down to $1.16 billion in 2020. As a result of COWID-19, wildfires, and other external factors, the impact on business income is expected to decline by 19.9 percent in 2020, reducing the total economic impact (revenues plus wages) from 2019 by $1.48 billion, or 20.5 percent.
Economist Eiler writes in the report, “The combined impact of COWID-19 and Fire and Smoke in 2020 reduced the industry’s economic impact on the Oregon economy by approximately 20.5% compared to the 2019 estimate,” but adds a positive note to the summary with the growing prominence of Oregon wines. “With Nielsen retail data also showing Oregon wines leading all major regions in volume and dollar growth in 2018 and 2019, the outlook for the Oregon wine industry remains positive, even though 2020 has been a challenging year. COWID-19 has significantly reduced tourist traffic, and the effect of the fire’s smoke on 2020 wines remains to be examined.
Miller, for whom this is the fifth report published on the economic impact of Oregon wine, sees Oregon’s value in its high price per bottle and the fact that demand, even in a fiscal year that is difficult for most people, is still driving people to pay more for Oregon wines. “Many different data sources show that Oregon has the highest average price per bottle among wines from other states and even other countries. This ability to set higher prices bodes well for the future of Oregon wines as the wine market here continues to grow.”
The Oregon Wine Board and the state benefit from a 15-year perspective on the growth of Oregon’s wine industry. Tom Danowski, OWB President, said, “We are pleased to sponsor this comprehensive report on the health and performance of our state’s growing wine industry as we move toward a gradual recovery. The ripple effect of our state’s wine industry on sustainable rural employment, agritourism and the local tax base is becoming increasingly important to our state. The modeling expertise of Christian Miller and Robert Euler and Oregon’s experience were particularly important this year in developing a credible 2019 database from which to make estimates for 2020.
Grapes are Oregon’s most valuable fruit crop, worth $238 million, more than apples, cherries, cranberries and hazelnuts combined. Pears are the second most valuable fruit crop, worth $109 million.
The charts below provide a breakdown of total sales, employment and wages for each of the four wine growing regions, as well as the top ten wine provinces, based on wine-related sales. A brief summary and link to the report can be found here, and the full report can be found here. The results of this study will be presented in more detail on the third day of the Oregon Wine Symposium, Thursday, February 18, 2021, from 1:00 to 1:45 p.m.
About the Oregon Wine Council:
The Oregon Wine Council is a semi-independent body in Oregon that administers marketing, research and education initiatives that support and promote Oregon wine and the wine industry. The Council works on behalf of all Oregon wineries and independent producers across the state’s wine regions. For more information, visit industry.oregonwine.org.
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