Willamette Valley Vineyards has posted net losses for the first quarter, as sales in the period levelled off.

The Oregon wine producer said late last week that net losses for the three months to the end of March came in at US$188,344, compared to net profits a year earlier of $165,156. Operating losses totalled $272,756 versus operating profits of $304,369 in Q1 2009.

Sales, meanwhile, slipped only slightly to $3.55m from $3.63m.

“The decreased sales revenue is principally driven by the loss of product placements and reduced order activity from some of our key chain store customers,” Willamette Valley said.

The company also noted that it suffered from “increased production costs on produced brands across product lines”.

“This quarter was caught in the cross hairs of high pre-recession wine-grape, packaging and transportation costs imbedded in our cost of goods and recession promotional pricing,” said company founder and president, Jim Bernau. “The historically low yield in 2008 made Oregon's best vintage ever but compounded escalating costs by increasing the farming costs per case produced.”

Earlier this year, Willamette Valley reported a 3% increase in both profits and sales for 2009.