Hard times press Ore. wine industry

Oregon's winemakers know what it's like to struggle.

Until the movie "Sideways" turned things around in 2004, a lot of people were surprised that Oregon even made wine.

But now, the pinot noir the movie celebrated is the country's fastest-growing wine, increasing at an annual clip of nearly 15 percent, as the state's $1 billion wine industry sets records for sales, acreage and volume,

But hard times are spreading in wine country, even if the pinot noir sales remain strong.

"I've worked in wineries for 23 years now, and I've never felt more caution than I feel right now," said Bill Hatcher, a principal with A to Z Wineworks in Dundee. "Some people are suddenly finding themselves in a world of hurt."

The recession is throwing immediate and significant challenges at winery owners, who already had their hands full with increases in the costs of materials and services such as glass, corks, fuel and freight.

At Sokol Blosser Winery in Dundee, that means working with national distributors to trim by-the-glass prices on red and white blended-grape offerings sold in restaurants. Sales of those wines help finance production of premium pinot noir.

"Our blends have definitely been hit the hardest by contractions in the economy," said Alex Sokol Blosser, the winery's co-president. "The good news is that pinot noir is holding steady. We're very pleased about that."

The winery, in an effort to stimulate wine-country tourism over the long Thanksgiving weekend, also paid for its first radio ads.

If past recessions are any measure, alcohol consumption won't go anywhere but up, said Craig Eastman, director of business development for Northwest Core Collection, a Portland-based company that distributes and helps market wine for seven Oregon wineries and two in Washington.

But current indications are that consumers are "trading down" by buying less-expensive wines. That means vintners will have to increase sales of so-called value brands if they want to maintain profit levels.

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