After last year’s strong 4% sales gain, the biggest since the buying frenzy in 1999 to ring in the new millennium, champagne makers are feeling the impact of the sour economy from $5 sparkling wines to $100 bottles of champagne.

“I don’t have a bright outlook for champagne this year,” says Frank Walters, research director for Impact, which expects the category to be down 1% to 4%, from about 900 million glasses sold in 2007.

“Luxury items are getting hurt, people are looking for value, restaurants are getting clobbered and with unemployment rising, people are watching their shekels.”

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