Iowa wine industry poised for expansion, according to Iowa State University professor


The economic impact of the Iowa wine industry grew by about 80 percent between 2008 and 2012, according to a recent study. PHOTO: Santa Maria Vineyard near Carroll, Iowa. Photo by Mike White. Larger image.

AMES, Iowa – The expansion of Iowa’s wine industry in recent years shows its potential to become a regional leader, an Iowa State University professor said this week.

A recent study from 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 Midwest Grape and Wine Industry Institute was formed at Iowa State in 2007 to support the state’s evolving grape and wine industry. Dharmadhikari, an associate assistant professor of food science and human nutrition, said the institute has helped to spur the growth of the industry by researching grape varieties that can thrive in the Midwest and by offering educational and outreach programs.

He 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, according to the study.  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.

“From small towns and rural farms to larger cities, members of the Iowa wine industry are investing in their communities and the people who live there,” Dharmadhikari said.

The full study, which was commissioned by the Midwest Grape and Wine Industry Institute, is available on the institute’s website.