"I think it's going to be a good crop," said Parker Carlson, owner of Carlson Vineyards Winery on East Orchard Mesa. "It might be down a little (in quantity) from last year, but the quality is up."

To Norm Christianson, owner of Canyon Wind Cellars in Palisade, this year's grape crop represents a recovery from five years of drought, which reduced crop levels.

"Our crop levels are back to normal, and we like the juice we're getting," Christianson said. "Good flavors and lots of fruit."

Carlson and Christianson's observations appear to be the case throughout Colorado, said Doug Caskey, executive director of the Colorado Wine Industry Development Board.

"What I've heard from everybody is that it's looking good," Caskey said.

A strong year for grapes and winemakers would mean more growth for the state's rapidly developing wine industry. Wine production in Colorado has steadily increased during the past decade, from 99,660 liters in the 1995-1996 fiscal year to 688,900 liters in 2004-2005, according to calculations by the state wine board.

Wineries in the Grand Valley were responsible for almost 60 percent of statewide production last year. Western Slope wineries outside the Grand Valley accounted for another 13 percent of production, and Front Range wineries made up the rest.

"We're still growing rapidly," Caskey said. "We have new wineries coming online, and existing wineries are increasing production."

Almost all of the wine produced in Colorado is sold in-state, he said, and product demand continues to grow. If this year's grape harvest comes in at a record or near-record level, Caskey said, it should help wineries increase their production to meet that demand.

"Our sales are rising," Christianson said. "Last year, we had the best year we've had in terms of sales."

Carlson said many grape growers in Colorado are fine-tuning the way they grow their crop in the state's high altitude and dry climate, and they're producing better grapes as a result. In the end, better grapes make better wine.

Although strong markets for Colorado wine exists inside the state's borders, local winemakers say they continue to face hurdles in selling and shipping their product to out-of-state buyers.

A U.S. Supreme Court decision last year struck down regulations in some states that essentially gave preferential treatment to in-state wine producers. The decision initially was hailed as a victory for small producers that wanted to level the field for interstate competition. However, the decision resulted in a patchwork of state laws that small wineries have a hard time sorting out.

"It's one of those laws that sounds good, until all the states take a shot at it," Christianson said.

"The out-of-state shipping has turned into a giant can of worms," Carlson said. "It's really frustrating at this point."

The court decision left it up to states to regulate alcohol sales as long as those regulations don"t favor in-state producers over out-of-state producers. Fee structures and paperwork requirements for wine sellers vary from state to state, and small Colorado wineries are finding it a burdensome task to keep track of regulations in each state where they want to do business.

"A lot of wineries have just stopped shipping out of state, period," Caskey said.

"We do still ship out of state," Carlson said, but he noted small wineries must balance the cost and headaches of each state's requirements with the amount of sales they expect to make in that state.

Christianson said Canyon Wind Cellars evaluates its customer base in other states before deciding whether to buy licenses and take on the required paperwork.

"It simply isn't worth a $200 license every year to ship three cases," he said.

Colorado's law, passed earlier this year by the state Legislature, requires wineries that ship products in Colorado to buy a $50 license, which local winemakers said isn't a problem because almost all of their sales take place in-state. The law also eliminated the requirement that wineries could ship products only to customers who had visited their tasting rooms.

"It is still very, very easy for Colorado wineries to ship within the state," Caskey said.

Bob Kretschman can be reached via e-mail at bobk@bresnan.net.