VANCOUVER - The holiday cheer may be flowing in its usual copious quantities this Christmas and New Year, but the booze industry is bracing for a recession-sized hangover for some of the pricier prestige items like icewine and Champagne.

The slump may be felt most in sales to restaurants rushing to adapt menus and wine lists to more frugal times.

"We're like the canary in the coal mines," says Robert Simpson, general manager of Liberty Wine Merchants, a six-store Vancouver chain.

"If you have a large stock portfolio, you've been hit. Those are the kind of people that drink Champagne. We're not selling a lot of Champagne at the moment."

Ditto for vintage wines, apparently.

"I already know that at the big wine auctions prices are coming down by 20 and 30 per cent, 50 per cent in some cases, and a lot of lots are going now unsold," says Simpson.

"What I'm hearing out of California is some of these cult wines, which sell for $600 or $700 a bottle on release, they're quietly offering them out at half-price, and cult wines at $150 are being offered at $75."

What a change from even six months ago.

"You couldn't buy them because they were in such short supply," says Simpson. "Now they're going back to clients that they wouldn't sell wine to and saying we'll not only sell to you, but we'll sell to you at half the price it was."

The picture is mixed at government liquor stores.

"Our sales projections are pretty much on plan," says Chris Leighton, a spokesman for the Liquor Control Board of Ontario.

However, Champagne sales are down 6.6 per cent for 2008 and icewine dropped 8.2 per cent, continuing a years-long decline, he says.

Jodan Hayes, a product consultant at the B.C. Liquor Distribution Branch's specialty store in Vancouver, says the economic gloom hasn't hit her customers yet.

"I don't really think that they're shopping down-market," says Hayes as customers trundle booze-laden shopping carts around the displays. "I haven't seen any shortage of sales, at least at this store."

If anything, Hayes expects to do a brisk business in Champagne among the cognoscenti looking forward to uncorking the 1995 and '96 vintages that are just becoming drinkable.

"I think that the collectors are always going to collect," she says.

"Even with the downturn economy, I mean, for somebody who has seven houses and they lose one, does this mean that they're not going to purchase Dom (Perignon)? I don't think so."

But a holiday buyer may elect to skip the Champagne for toasting and "may go and do a Napa bubble instead and just save the extra $20 or so."

Over at Vancouver Wine Vault, owner Rick Underwood is not seeing any fall-off in business yet from his well-heeled clientele who stash their wine collections in his climate-controlled warehouse.

"In fact, we're up; we've increased our flow in," says Underwood. "A lot of guys would be liquidating their (stock) portfolios and buying hard assets like gold or wine."

He's expecting an influx of clients laying down cases of just-released 2005 Bordeaux, which is getting rave reviews and asking prices of $1,100 or more for the rarest bottlings.

"It's a guaranteed blue-chip, investment-grade wine," says Underwood.

Still, a glance at Craig's List, the Internet classified-ad site, turns up a handful of wine collections for sale, including one willing to take the first reasonable offer.

"True, (the) recession may affect me holding onto these wines for decades because it's like locking up cash in the vault," one Craig's Lister selling his small Bordeaux collection says in an email.

"However, recession doesn't stop me from getting the wine I want. I am just simply using my cash flow for wine more wisely."

Icewine would also seem to be vulnerable. The sweet dessert wine made from grapes that must freeze on the vine has become identified with Canada, the largest producer.

Thanks to limited production, a 200-millilitre half-bottle of icewine can sell for $30 to $60.

Icewines are a small fraction of their sales for most wineries, but at Inniskillin, the country's largest producer, it can make up as much as 40 per cent of sales depending on the harvest.

"For us it's quite major," says Inniskillin's Deb Pratt.

Vincor Canada, which owns Inniskillin, saw sales brake abruptly in November after a normal October.

"It certainly has caught up with us," says export director Randy Dufour.

About two-thirds of Inniskillin's icewine production is exported. Dufour says there are no plans to cut prices but instead promote the brand more and perhaps offer gifts with purchases.

Pratt says icewine is still a popular souvenir among tourists and Hayes says new Canadians like taking it home to the old country, like smoked salmon and maple syrup.

Restaurants are one sector where recession thinking has taken hold. They understand diners may balk at the markup on wine that's two and sometimes three times the store price, instead drinking a good bottle with a home-cooked dinner.

"Clearly in today's new economy the expectation is people are looking for value," says Ian Tostenson, president of the B.C. Restaurant and Foodservices Association.

Restaurant traffic is still strong, he says, but people are dining out less while spending a little bit more.

"The high-end economy was six months ago," says Tostenson. "It's not there now.

"Instead of buying a bottle they'll buy a couple of glasses, or instead of buying a $50 bottle of wine they might trade to a $30 bottle of wine."

Liquor sales represent most of the profit in the notoriously thin-margined restaurant business, but Tostenson says some eateries may cut their booze markups to ease the sticker shock for customers.

"The thing about restaurants is that they can change their business model ... virtually within hours or overnight," he says. "They're very responsive to this."