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02.28.2014  
 

Economic Impact of Cold-Climate Grapes Hits $401 Million

Cold-hardy varieties boost wine industry in 13 states

 
by Linda Jones McKee
 
 
“minnesota
 
Source: Vineyards and Wineries in Minnesota: A Status and economic Contribution Report by Brigid Tuck and William Gartner
St. Paul, Minn.—Cold-climate grapegrowing is based primarily on four varietals—Frontenac, Frontenac Gris, La Crescent and Marquette—that are products of the grape-breeding program at the University of Minnesota. The first of the four, Frontenac, was released in 1996, and the last, Marquette, was introduced 10 years later, in 2006. Because these grapes can grow in places where winter temperatures regularly drop below -20°F, a new farm winery industry developed in northern states where growers cannot reliably grow vinifera or even French hybrid grapes. A new study, based on data from 2011, shows that the economic impact of the cold-climate wine industry on the United States economy has reached $401 million.

Two University of Minnesota Extension researchers, professor William Gartner in the Department of Applied Economics, and Brigid Tuck, economic impact analyst for the University of Minnesota Extension Center for Community Vitality, conducted the economic contribution study as part of the USDA-funded Northern Grapes Project. Researchers, extension specialists and industry professionals from 13 states are part of this project, with the goal of addressing viticulture, enological, business management and marketing issues as they relate to growing cold-climate grapes and making wines from those varieties.

In 2012, Gartner and Tuck surveyed growers and winery owners in those 13 states about growing practices (vineyards), operating practices (wineries), and sales and production (both vineyards and wineries). A total of 345 vineyards and 199 wineries gave full answers to the surveys.

Tuck presented the results of the study Feb. 22 at the Minnesota Grape Growers Association’s 10th annual Cold-Climate Grape and Wine Conference in St. Paul, Minn. Among the key findings of the research were the following:

• The cold-hardy wine grape and locally sourced winery industries contributed $401 million to the economies of the states in the project, including $130 million of labor income, and generated 12,600 jobs. Overall, the wine grape and locally sourced winery industries contributed a total of $1.5 billion to the economy, including $409 million of labor income, and created 28,200 jobs.

• Wines made from cold-hardy grapes at locally sourced wineries contributed $215 million in economic activity and 5,000 jobs.

• Wine vineyards growing cold-hardy grapes generated $46 million in economic activity and 5,900 jobs.

• Winery tourists visiting wineries using cold-hardy grapes in their wine production created $140 million of economic output and 1,700 jobs.

In the years since Frontenac was released, growers in the 13 cold-climate states have planted approximately 5,400 acres of cold-hardy grapes, including 3,260 acres of cultivars bred at the University of Minnesota. Of the 199 wineries included in the 2012 survey, 80% opened after 2002.

Minnesota: 2007 vs. 2011
What a difference a few years can make. The cold-climate study discussed above included information from surveys conducted in 13 states. In 2007, Gartner and Tuck conducted an economic impact study for the Minnesota Grape Growers Association based on data collected from Minnesota vineyards and wineries. After compiling the information for the cold-climate study, the researchers took the information relating exclusively to Minnesota and put together a separate impact study for that state.

The comparison between the two Minnesota studies reveals how quickly growers and winemakers in that states have embraced the new cold-hardy varietals from the University of Minnesota. The total economic impact of the grape and wine industries in 2007 was $36.2 million, with vineyards contributing $13.61 million, wineries $8.5 million and winery-related tourism $14.05 million. By 2011 the total economic impact had increased to $59 million, and vineyards were responsible for $16.4 million, wineries $22.1 million, and tourism $20.5 million. In 2007, there were 324 jobs in the grape and wine industries, and by 2011, the number of jobs increased to 3,250.

The Cold-Climate Conference, 2014
In spite of a blizzard that delivered icy conditions and 12 inches of snow to St. Paul, more than 600 people attended the Cold-Climate Grape and Wine Conference. Terri Savaryn, conference director, told Wines & Vines that the weather didn’t deter people from attending the conference Feb. 20-22; many people came in early so they would not miss it. She also related one minor aspect of the conference that graphically illustrated the hardiness of cold-climate grape varieties. Early in February, clippings pruned from cold-hardy vines at -20°F were brought inside. By the time of the conference, those clippings had budded out and served as the centerpieces at conference events—a visible reminder of the hardiness of cold-climate grapevines.

Resources
The complete study, “Economic Contribution: Vineyards and Wineries of the North,” is available here, and the 2007 and 2011 Minnesota Economic Impact Studies are posted under “Resources” at mngrapegrowers.com.

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