Gabriel Reis, a winemaker at Painted Rock Estate Winery, stands in the winery’s cellar in Penticton, B.C., on Jan. 9.Aaron Hemens/The Globe and Mail
Albertans will now be able to order wine directly from B.C. wineries under an interprovincial agreement, raising hopes that the practice will eventually be expanded right across the country.
Alberta joins Manitoba, Nova Scotia, Saskatchewan and B.C. in the free movement of direct-to-consumer wine.
The program in Alberta, which began Jan. 6, means wine drinkers in the province can order from more than 300 wineries across B.C. through online sales and subscription-based wine clubs.
Alberta’s liquor board will charge a fee to producers and the agreement will be reviewed after one year.
“The B.C. wine industry is a cornerstone of our province’s agriculture and tourism sectors – and the direct-to-consumer program with the province of Alberta is not only a win for our wineries, but also for the communities and families who rely on this vibrant industry,” said British Columbia Premier David Eby.
Direct sales are important for B.C. wineries, which largely produce small batches. Provincial liquor boards demand large volumes and require high fees that make retail sales untenable for many smaller producers.
Gabriel Reis stands near the Painted Rock Estate Winery's vineyard in Penticton, B.C., on Jan. 9. The winery makes around 6,000 cases of wine per year.Aaron Hemens/The Globe and Mail
However, the agreement has wineries asking when free trade for their products will be permitted Canada-wide. The two largest markets, Quebec and Ontario, do not permit direct-to-consumer sales, a policy that some in the B.C. industry say is outdated and serves to hurt businesses and consumers.
“Free trade amongst Canada is one of the paramount things for not only industry survival, but it is also important for Canadians to be able to buy Canadian goods without barriers,” said Lauren Skinner Buksevics, director of sales and marketing at Painted Rock Estate Winery, a small-scale, premium winery in Penticton – the heart of B.C.’s wine country.
The winery is too small for major wholesale, she said. It produces around 6,000 cases of wine per year. Wholesale accounts for only 20 to 25 per cent of sales, with five to 10 per cent for export. The business relies on building relationships with wine enthusiasts across Canada. Around 70 per cent is direct-to-consumer sales, which happen in the tasting room or through a subscription service where wine is shipped directly to club members across Canada.
Wine fermenting units are stored in the winemaking facility of the Painted Rock Estate Winery.Aaron Hemens/The Globe and Mail
Technically, B.C. wineries are not permitted to sell direct to consumers in provinces that have not come to interprovincial agreements. However, it is an essential part of the business for many premium and small wineries, says Ms. Skinner Buksevics. They cannot meet the provincial liquor board demands. Conversely, direct to consumer also means more control over pricing.
“The more wine you can sell directly to a consumer, the less you’re a wholesale channel, the healthier the financial situation for wineries are,” said Paul Sawler, vice-president of sales and marketing for Dirty Laundry Vineyard. Mr. Sawler is also chair of the board of directors for Wine Growers British Columbia.
While Alberta has now joined other provinces in the free trade of wine, mounting uncertainty in the sector makes it more important that producers have access to all Canadian consumers, said Mr. Sawler.
Last year, 99 per cent of the Okanagan crop was lost because of a January cold snap. Some vines were so damaged that farmers had to pull them out and replant. A cold snap in 2023 also hurt the vineyards and led to crop losses of 58 per cent.
The B.C. industry is small in comparison to Ontario’s Niagara region, which produces 80 per cent of Canada’s grapes and wine. Barrels of wine are stacked and stored in the cellar of Painted Rock Estate Winery in Penticton, B.C., on Jan. 9.Aaron Hemens/The Globe and Mail
B.C. wineries therefore want access to more customers, including those in Canada’s largest market – Ontario, said Mr. Sawler.
Ontario wineries have been able to ship direct into B.C. for the past decade. However, Ontario did not reciprocate. This essentially cuts off the market for small-batch B.C. growers who cannot produce the volume required to sell to the Liquor Control Board of Ontario, or cannot afford the hefty fees.
“Small wineries, and maybe small craft breweries and things like that, just don’t fit the traditional government liquor-store model,” said Mr. Sawler.
The notion that alcohol sales and production should be restricted goes back to prohibition, said Jared Carlberg, professor of agricultural economics at the University of Manitoba. But alcohol receives special attention today because the liquor boards – the exclusive importers and distributors of alcohol – collect hefty taxes.
Wine bottles are pictured in the tasting room of the Painted Rock Estate Winery in Penticton.Aaron Hemens/The Globe and Mail
Provinces are also interested in protecting their homegrown industries. In this way, the LCBO shelters the Niagara Peninsula, Canada’s largest wine-producing region, said Mr. Carlberg.
But this restriction still doesn’t make sense to Mr. Sawler. The B.C. industry is small in comparison to Ontario’s Niagara region, which produces 80 per cent of Canada’s grapes and wine. Direct-to-consumer sales from B.C.’s niche industry are also “pretty small potatoes” compared with international imports. The LCBO is among the largest purchasers of alcohol in the world.
The dissolution of these barriers between provinces is very important, said Mr. Sawler, especially now as an incoming U.S. administration threatens steep tariffs on Canadian products.
“It only makes sense that – at least in Canada – we open our markets up to Canadian wineries.”