Economic impact of Iowa's wine industry grew nearly 80 percent over four years, study says

(DesmoinesRegister) - The economic impact of Iowa's wine industry has exploded in recent years, according to a new study.

Frank, Rimerman + Co., a California-based consulting firm, reported that the economic impact of Iowa's wine and wine grapes industry was $420 million in 2012, an increase of around 80 percent from $234 million in 2008.

"The industry is at a critical juncture," said Murli Dharmadhikari, the director of the Midwest Grape and Wine Industry Institute at Iowa State University. "Iowa-produced wines have captured 6 percent of the state's wine market, and now Iowa has the potential to lead the region in wine production and sales."

The institute commissioned the study.

Dharmadhikari said Iowa was home to around 30 wineries and 500 acres of wine grapes a decade ago. Those numbers have jumped to 100 wineries covering 1,200 acres today.

According to the impact study, as the number of Iowa wineries grows, so will the number of tourists visiting them. The report estimated that roughly 358,000 people visited Iowa wineries in 2012, up 51 percent from approximately 237,000 winery visitors in 2008. Wine, grapes and related industries account for 2,678 jobs in Iowa, according to the study.

The retail value of Iowa wine sold was $15 million in 2012, the study says. But Dharmadhikari pointed out that wine-related tourism brings even greater value to the state. Tourism to wineries generated $41 million last year, according to the study. And wages and jobs related to the Iowa wine industry accounted for $83 million.

He said the industry's growth has occurred in the state despite the fourth-highest wine excise tax in the United States.

Iowa vineyards and wineries are found in 86 of Iowa's 99 counties, and the majority of wineries are small enterprises with production of less than 5,000 cases.