Image provided by: University of Oregon Libraries; Eugene, OR
About Capital press. (Salem, OR) 19??-current | View Entire Issue (March 6, 2015)
12 CapitalPress.com March 6, 2015 Report estimates economic impact of wine industry at $3.35 billion VINEYARDS from Page 1 That means jobs — good ones, with plenty of over- time work — for foreman Morales, his brother, his nephew and other relatives among AAA Metal’s 14 to 16 employees. The same Full Glass Research report lists the average annual wage in Oregon’s heavy- gauge steel manufacturing sector, which includes firms much larger than AAA Met- al, as $56,669. Welding stainless steel takes skill, and the shiny tanks have to be finished to food-grade quality to pre- vent bacteria from growing inside. Surprisingly, none of the company’s welders has had special training; they all learned on the job. “All of these guys started from the bottom,” Morales says. “Sweeping floors, cleaning up. They learned by being here.” Continued expansion and investment by wineries, breweries and distillers has AAA Metal and its workers in a “really good position right now,” Morales says. “We just keep going,” he says. “We just keep making tanks.” $3.35 billion impact The recent Full Glass Re- search report estimates the economic impact of Ore- gon’s wine industry at $3.35 billion, counting crop value and direct and indirect jobs, wages, sales and services. The report is the work of California market analyst Christian Miller, a self-de- scribed “data geek” who studies the industry. The report details an in- dustry that has come of age. Although tiny compared to California and smaller than neighboring Washington, Oregon’s vineyards and wineries have carved out a niche that is economically, aesthetically and socially successful. In an interview after his “state of the industry” pre- sentation at the recent Or- egon Wine Symposium in Portland, Miller said the wine industry has a bigger ripple effect in the econo- my than other agricultural sectors. Wine-related tour- ism alone — all those cars streaming to tasting rooms off Highway 99W in Yam- hill County — pumps $207 million annually into the Oregon economy and em- ploys 2,623 people, Miller said. All told, Miller counts more than 17,000 wine-re- lated jobs in Oregon and $527 million in wages. Se- nior state economist Josh Lehner, in a February re- port, said the number of jobs in wineries, breweries, distilleries and their distrib- utors and retail outlets in- creased 46 percent since the start of 2008. By Miller’s estimate, the 2013 wine grape crop was worth $128 million and became the most valuable of Oregon’s fruit and nut Eric Mortenson/Capital Press Pierre Paradis, an Oregon State University student whose family owns a vineyard, is striking out on his own with a vine hedging, leaf removal and fruit hauling service. crops, passing hazelnuts, blueberries, pears, cherries and other stalwarts. The National Agricultural Sta- tistics Service had grapes in second that year with $107 million value, behind ha- zelnuts, but the giant grape harvest of 2014 may have reconciled any differences. At any rate, the value of Oregon’s wine grape crop has quadrupled since 2004, Miller said. The average price per ton paid for Or- egon grapes in 2013 was $2,249, far more than the $713 per ton average paid to California growers and $1,110 paid to Washington growers. Only California’s Napa County had a high- er price per ton, $3,683. The discrepancy with Cal- ifornia’s average price is due to the large volume of lower-quality grapes grown in the Central Valley, ac- cording to the report. Those grapes are used in “low-val- ue uses” such as concen- trate, according to the re- port. The price is another distinguishing feature of the Oregon wine industry, Miller said: It started by focusing on high-value, high-quality wine, partic- ularly Pinot noir, and has stayed that way. By all accounts, the in- dustry’s founding fathers and mothers were and are quirky, driven people who collaborated in order to sur- vive. The people who fol- lowed them include many who were accomplished in other fields, are highly edu- cated and brought resources with them. Grape growing and wine making is a mar- riage of science and art, and its practitioners tend to be hard chargers. It’s fair to say some of Top fruit Wine grapes superseded hazelnuts to become Oregon’s most valuable fruit crop in 2013. $128 million: Up 105.4% from 2010 $150 million 120 Cranberries Apples Cherries Pears Hazelnuts Wine grapes 90 $62.3 million $32.3 million 60 30 0 2004 Source: Full Glass Research Oregon’s traditional, con- ventional farmers believe the wine industry distances itself from them; vineyard producers are not particu- larly engaged in the Oregon Farm Bureau, for example. Other farmers can’t help but notice the attention and money flowing to the wine industry, and frankly worry it will bend legislation its way as well. This past year, a couple vineyard opera- tors loudly complained that spray drift from grass seed or Christmas tree operations was damaging grape vines. Traditional farmers resent the issue being taken pub- lic rather than worked out among farmers, as is usually done in Oregon. Other indicators The industry’s growing clout has a number of mark- ers: A law fi rm, Stoel Rives LLP, has a wine practice group spread among its dozen Western offices. The founding chair is Christo- pher Hermann, of the Port- land office, who flat out says vineyards and wineries have 2010 2013 Alan Kenaga/Capital Press transformed rural commu- nities and been a catalyst of economic development “up and down the Willamette Valley” and throughout the state. He also credits the in- dustry with touching off Or- egon’s local food movement, including fine restaurants and branching into craft beer breweries and spirits. “Win- eries led the way,” he says. Silicon Valley Bank has a 30-member “wine divi- sion” in its West Coast of- fices, works with about 350 vineyards and wineries and counts an estimated $1 bil- lion in committed loans to the industry, says Mark Fre- und, managing director of the bank’s Beaverton, Ore., offi ce. Oregon State Universi- ty started its Wine Research Institute in 2009 at the in- dustry’s behest — and with $2 million in industry seed money. Oregon now has account- ing fi rms and real estate companies that specialize in vineyards and wineries. Other businesses that have sprung up in support of the industry range from custom crush or Oregon’s wine industry growing (Millions of dollars) Percent change Revenue category 2010 2013 2010-2013 Winery sales $252.1 $363.5 44.2% Wine exported from state */** 93.3 127.6 36.8 ** Wine sold direct-to-consumer 115.1 196.9 71 Wine grape crop value 63.2 128 102.5 Wholesale ** 363.5 433.9 19.4 Retail sales (on/off premise) ** 716.3 816.7 14 Wine-related tourism 158.5 207.5 30.9 Direct tax revenues 34.1 37.8 10.9 Indirect/supplier revenues 283.5 449.6 58.6 Induced revenue impact 375.2 388.9 3.7 *Does not include direct-to-consumer sales shipped to consumers in other states. **2010 numbers have been restated for either greater accuracy or to put them on the same methodology as 2013. Source: Full Glass Research Alan Kenaga/Capital Press fi ltration companies to ones that use falcons to chase pest birds from vineyards. There’s still room for startups. Pierre Paradis, an Oregon State University stu- dent whose family owns a vineyard in Silverton, started a custom hedging, leaf re- moval and fruit hauling busi- ness called Rainbow Valley Enterprises. In 2013, according to Miller’s Full Glass Research, the industry spent $21.9 mil- lion for bottles, $11.5 million for corks, screwtops and other closures, $5 million to $7 mil- lion on oak barrels and bought 37 million labels worth an es- timated $10.4 million. Of the latter, 84 percent went to Or- egon fi rms. Carrie Higgins, who founded Crush Creative Pack- aging of Lake Oswego in 2005, has seen her labeling business grow with the indus- try. One of her early clients was A to Z Wineworks, which in its infancy wanted 5,000 labels for a modest Pinot noir offering. Now Higgins sells A to Z 4 million to 5 million labels a year, and the winery itself has grown to be one of the state’s largest. In 2006, partnering with San Antonio Spurs Coach Greg Popovich, A to Z bought Rex Hill Vine- yard and Winery in Newberg. “It’s very circular growth, is what I would call it,” Hig- gins says. “I never thought I’d grow up and sell wine labels. It’s a very niche market.” At least two Oregon com- panies, Signature Bottlers and Casteel Custom Bottlers, pro- vide mobile bottling services, going from winery to winery. Miller says the industry has room to grow. Oregon produces no glass or corks, he says, ticking off some of the opportunities, and there’s only one oak barrel manufac- turer in the Pacifi c Northwest. Varietal expansion is like- ly as well, Miller says. While Oregon is best known for Pi- not noir wine produced in the Willamette Valley, and Pinot noir grapes make up 67 per- cent of the total wine grape crop value, the Pinot gris wine coming out of Southern Oregon is under-appreciated, Miller says. “I don’t see it bumping into a ceiling any time soon,” he says. Extra frost protection is an added expense to growers FROST from Page 1 “It makes for an extra month of frost protection, which is an added expense to growers,” he said. Apricots reportedly were blooming in a few early areas of the state on March 3, said Tim Smith, WSU tree fruit specialist in Wenatchee. With 60s forecast for the weekend, buds may wake up in the next couple weeks in Wenatchee and Red Delicious full bloom could be early, he said. Warm weather allowed crews to plant 60 acres of apple trees Feb. 26-28, about a week ahead of schedule, at Zirkle Fruit Co.’s CRO Or- chard at Rock Island, said Mike Meadows, orchard manager. Buds are swelling, he said, and with a low of 24 degrees the morning of March 3, he was close to using frost protection. “I’ll start watering tomor- row, which is two to three weeks earlier than nor- mal,” said Keith Middle- ton, an asparagus and hay grower in Pasco. He harrowed hay fi elds and transplanted asparagus nursery stock earlier than ever and said asparagus harvest may start early. Normally, it starts April 1. Once it was March 26. Alfalfa and timothy are growing and could be earlier or heavier on fi rst cutting, he said, adding he was watching a person wake boarding on the Columbia River near Blue Bridge in Pasco as he spoke. The air temperature was 50 degrees, he said. Jose Gracia, left, and Luis Chavez ignite a bonfi re March 4 to protect cherry buds at Rancho El Rosario west of Prosser, Wash. Gracia, the orchard manager, started his work about 8:30 p.m. the night before. In all, he used 63 bonfi res, 280 diesel furnaces and eight wind machines to raise the temperature in the orchard. Yakima Herald-Republic Associated Press State delisting would eliminate endangered species status for wolves REPORT from Page 1 years. Oregon counted six breeding pairs in 2012 and four in 2013. State delisting would eliminate endangered species status for wolves in the east- ern third of the state and give cattle ranchers more leeway to protect livestock. The U.S. Fish and Wildlife Service has already delisted wolves in Northeast Oregon, but they remain under state ESA pro- tection. Wolves in the rest of Oregon — such as well-trav- eled OR-7 and his mate and pups in the Southwest Oregon Cascades — remain covered under the federal ESA. Delisting would be a lengthy public process that would include time for com- ment, according to ODFW. The commission isn’t expect- ed to take any action toward that on Friday, but may direct staff at its April meeting to be- gin the process. Conservation groups have warned against delisting Ore- gon wolves too soon. Oregon Wild, a key player in formu- lating the wolf plan, said the wolf count represents “great progress” but does not rep- resent biological recovery. Conservation director Doug Heiken has said the state needs to see better geographical dis- tribution of wolves as well. He said that will happen over time if wolves are not prematurely delisted and “persecuted.” The Oregon Cattlemen’s Association holds the op- posite view. Spokeswoman Kayli Hanley said Oregon has allowed the wolf population to grow unchecked. Ranch- ers expect more attacks on livestock this year if wolves continue to remain on the en- dangered species list, she said in an email. The meeting is at 8 a.m. Friday in ODFW’s commis- sion room, 4034 Fairview In- dustrial Drive S.E., Salem.