PENNSYLVANIA'S WINE INDUSTRY FULL OF POTENTIAL, SURVEY FINDS
January 5, 1997
UNIVERSITY PARK, Pa.-- Research under way in Penn State's College of Agricultural Sciences suggests that Pennsylvania's vineyards and wineries will expand in the next five years.
The state has supported a small wine industry since the early 1970s, when the Pennsylvania Farm Winery Bill allowed for the establishment of wineries, which currently have a production limit of 200,000 gallons annually. The law also permits the operation of retail sales locations and direct sales to businesses and individuals.
"The state's vineyard and winery industry is vibrant and growing," says Dr. Stephen Smith, associate professor of agricultural economics. "In the 1980s, an average of 2.3 vineyards and 1.1 wineries were started per year. In the 1990s, the average was 2.7 vineyards and 1.5 wineries started per year. It's still a small industry, but it's becoming very well established and is carving out an important niche in the state's agricultural economy." /P>
Smith and Dr. Jayson Harper, associate professor of agricultural economics, surveyed Pennsylvania vineyard and winery owners about production costs and business characteristics, markets and marketing problems, and the future of the wine industry in Pennsylvania.
"Wineries are very optimistic, with 79 percent of the respondents expecting to increase production in the next five years," Smith notes. "Seventy-eight percent of the wine makers also expect on-premises retail sales to increase. Between 52 and 62 percent expect sales to increase through the Pennsylvania Liquor Control Board, retail expansion of premises, direct sales to hotels and restaurants, and food expositions."
More than 80 percent of both vineyards and wineries were started from "scratch" by their owners. Fifty-six percent of the vineyard owners and 59 percent of the winery owners were 40 years old or older when they began their business. Almost two-thirds had some previous business experience, and many also had taken training in grape growing and wine making.
Respondents also were asked about Pennsylvania's winery laws. "Over 64 percent of respondents agreed or strongly agreed that the law should be changed to allow wine sales in grocery stores, with only 26 percent disagreeing," Harper notes. "About 80 percent also agreed or strongly agreed on instituting a 1 cent per bottle tax on all wine sold within Pennsylvania to support wine research, extension and promotional programs."
There was no clear opinion on changing the law to allow making and selling of wines using out-of-state grapes. "Thirty-nine percent of the respondents agreed or strongly agreed with this change, but 45 percent disagreed," Harper says.
Pennsylvania ranks fourth nationally in total grape production, behind California, Washington and New York. Most of the state's acreage is in Concord grapes for juice, not wine grapes. Some in the industry are concerned that their future may be limited by the acreage of wine grapes grown in the state, even though it is growing.
"On average, the vineyards started with 4.5 acres of wine grapes, 6 acres of juice grapes, and 0.2 acres of table grapes," Smith says. "The current average acreage of wine grapes, while still small at 9.1 acres, is more than twice the average initial acreage. Vineyard owners indicated that they plan to increase their acreage of wine grapes by 30 percent over the next five years."
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EDITORS: Contact Stephen Smith at (814) 863-8245 or Jay Harper at (814) 863-8638.
Contacts:
Eston Martz
Eston_Martz@agcs.cas.psu.edu
(814) 863-3587
(814) 865-1068 fax