PORTLAND, OR, June 1, 2022 – It’s been a turbulent few years for Oregon agriculture, namely Oregon growers and winemakers who’ve had to adapt to a new world of regulations and safety protocols due to COVID-19. Not to mention wineries temporarily having to close tasting rooms, extreme heat and cold, wildfires and wildfire smoke in Oregon. Despite these threats to business as usual, Oregon Wine Board (OWB) commissioned veteran wine industry expert Danny Brager to analyze market data for 2021. Brager a found a number of bright spots showing Oregon wine continues to make strides by leading the category of table wine at retail across premium price segments in U.S. markets, for both on off-premise and DtC sales for Oregon wine.
For his report, here on the OWB industry site, Brager conducted his own research and consulted a number of research reports, including Nielsen, SipSource, Sovos ShipCompliant and Wine Vines Analytics.
When looking across the wine landscape, Brager found that sales growth, both on and off premise, were up 7.7% (in the chart above) for table wine, yet for Oregon was up over 23% in dollar growth. For 12 months ending January 2022, one of the brightest spots was the higher priced wine between the $25 to $49 price per bottle segment, which is trending up 11.9%. The $50+ wines are trending up 45.8%. For Oregon, a winemaking region that sits comfortably at the table of higher priced wines, our largest share gains are in the $20-$25 table wine segment. Brager noted: “Oregon’s price tier trends tend to generally ‘mirror’ overall Table Wine trends – but unlike Oregon, total table wine trends are weighted heavily to the ‘bottom’ tiers.”
It goes without saying that Pinot noir, making up 58% of the planted acreage in Oregon, is the dominant variety here. However, what many may not know is that, when compared to Cabernet Sauvignon, Zinfandel, Sauvignon Blanc, Chardonnay, Red Blends, Merlot, Rosé and Pinot gris in $15+ domestic table wine, Pinot noir is head and shoulders above the rest at a 32.8% volume share the 12 months ending January 2022. Similarly, Pinot noir’s volume growth by variety in Oregon was up 18.3% in 2021, three times the growth of Pinot noir across the U.S. which came in at 6.1%.
Oregon growth leads, with the price/mix still moving upward (dollar growth>volume growth) at 23.1% in dollar value compared to volume at 18.8%. What this means is that the wine has increased in value more rapidly than volume, showing that demand for Oregon wine, even when priced on average higher than other regions per bottle, continues to grow. This is compared to California at 7.9% in dollar value and Washington with a -4.9% decrease in dollars.
Oregon continues to maintain its premium, higher than average retail price in stores, a key factor in insulating the wine business given broader wine premiumization price tier trends. A 750 ml bottle of Oregon table wine cost $17.10 in 2021, California’s was $10.46, and Washington’s $8.15. Total market overall price is $8.46 per bottle on average.
As for sparkling wine, Oregon showed enormous growth, up 62.5% total volume in 2021. Compare that to total volume for domestic Sparkling wine at 10.1%. Chardonnay is the second highest total volume growth, with a 42.8% increase, even more outstanding considering that Chardonnay across the U.S. was down -3.2%.
In wines shipped direct to consumers in 2021, Oregon averaged $42 for an average bottle, behind California at $43.94, with Napa specific wines at $72.41 per bottle, but over $6 higher per bottle than Washington as reported by SOVOS/ShipCompliant.
In summary, Brager notes the following growth points:
- The Oregon segment is growing faster than the table wine category, both in retail and DtC
- Oregon wine is a premium player as a key participant and driver of growth at the premium end of the overall wine market (higher price tiers)
- Oregon wine is a meaningful retail, three-tier, and DtC player, and DtC in general is commanding a larger OVERALL channel share within wine
- Oregon wine’s signature varietal Pinot noir is making further inroads nationally, with the share expanding both within and outside of Oregon.
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About the Oregon Wine Board
The Oregon Wine Board is a semi-independent Oregon state agency managing marketing, research and education initiatives that support and advance the Oregon wine and wine grape industry. The Board works on behalf of all Oregon wineries and independent growers throughout the state’s diverse winegrowing regions. Visit oregonwine.org.
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