2008 Ontario Grape Prices Finalized
Prices were not fixed until this month, following binding arbitration
Frozen grapes destined for ice wine remain on the vines long after the normal harvest ends, and command a higher price on the market. These clusters are ready for the picking at D'Angelo Vineyards Estate Winery in Amherstburg, Ontario.
Toronto, Ontario -- Winegrape prices are determined in different places by different systems. In the United States, grape prices are decided between the seller and the buyer, and there are no laws in place to affect those agreements. In Ontario, however, winegrape prices are negotiated between the Grape Growers of Ontario and the Wine Council of Ontario.
For the past three years, grape prices there have been stable, following a memorandum of understanding that was signed in 2005 in the wake of a short crop caused by the harsh winter of 2004. This agreement gave grapegrowers a price hike of 3% across all grape types in 2006, and 2% in 2007.
The three-year agreement expired in 2008. This year, therefore, was a new ballgame. In late July, negotiations between the growers and the Wine Council broke down, and both sides submitted their prices for arbitration by the Ontario Farm Products Marketing Commission in Toronto. The decision that is made through arbitration is the acceptance of either the price submitted by the growers or the wineries.
This year's arbitration results were expected to be announced at the beginning of October, but hearings were not held until late October and the results were not announced until early November, weeks after all but grapes destined for ice wine were harvested. The growers claimed the outcome was a victory. On their website grapegrowersofontario.com, chairman Bill George Jr. wrote, "We are pleased that the arbitrator ruled in favour of the winegrape prices presented by the Grape Growers of Ontario. This year, growers will receive an increase in some grape varieties consistent with what (we) had requested."
Debbie Zimmerman, the group's CEO, stated she is "Delighted with the decision."
The major changes in price were not for vinifera or hybrid grapes, but for some juice grapes (labruscas). Concord grape prices were increased 24%, from CAD$330 (all prices quoted are in Canadian dollars per tonne, about 1.1 US ton) to CAD$410, and Niagara was up by 29%, from CAD$315 to CAD$405. Catawba, Delaware and Dutchess were up by a much smaller percentage, from CAD$499 to CAD$510.
By comparison, prices for both vinifera and hybrid varieties remained the same on five varieties, including Johannisberg Riesling, Gewürztraminer, Pinot Noir, Maréchal Foch and Léon Millot. Prices were down by 1% for Chardonnay and by 2% for Cabernet Sauvignon and Merlot. Other vinifera and hybrid varieties were up between 1% and 2%, with Seyval Blanc and Vidal increasing by 3%.
The Grape Growers of Ontario, which represents about 600 growers who produce approximately 54,000 tonnes of grapes in an average year, negotiates prices for each grape variety that is grown commercially and sold to processors. The negotiations for the various classes of winegrapes were held in 2008 with representatives of the 84 member wineries of the Wine Council of Ontario to establish the minimum prices at which these grapes could be bought or sold in Ontario this year.
These prices are binding on all winegrape transactions, whether or not they involve the negotiating wineries. In addition, there are three classes of juice grapes--labruscas are not classified as winegrapes--where the prices are negotiated by the Grape Growers of Ontario with a separate committee of processors. Again, while growers contract directly with processors, the prices cannot be lower than those set by negotiation.
Ontario Grape Prices 2007 & 2008 Grape 2007 (CAD$) 2008 (CAD$)
De Chaunac and Rosette $646 $659
Maréchal Foch and Léon Millot $788 $788
Baco Noir, Chambourcin and Chancellor $851 $860
Seyval Blanc, Vidal 256 $583 $600
Johannisberg Riesling $1,471 $1,471
Chardonnay $1,524 $1,509
Gewürztraminer $1,639 $1,639
Pinot Gris $1,639 $1,672
Sauvignon Blanc $1,639 $1,655
Gamay and Zweigeltrebe $1,381 $1,395
Pinot Noir $2,101 $2,101
Cabernet Sauvignon $2,080 $2,038
Cabernet Franc $1,786 $1,822
Merlot $2,101 $2,059
Shiraz $2,101 $2,143
The following prices for some labrusca juice grapes in 2008 include:
Labrusca Grape Prices 2007 & 2008 Grape 2007(CAD$) 2008(CAD$)
Concord $330 $410
Niagara $315 $405
Catawba, Delaware and Dutchess $499 $510
Several other prices are related to late harvest wines or ice wines. The minimum price for ice wine grapes is 125% of the price based on normal harvest. Ice wine juice prices, again in Canadian dollars, are hybrid juice: CAD$15.76 per liter at 35° Brix; and vinifera juice: CAD$24.16 per liter at 35° Brix. Late harvest hybrid juice is CAD$4.58 per liter at 26° Brix. These prices remained the same as in the previous pricing arrangement.
Sugar standards are a system of bonuses and penalties adjusting the grape price on the basis of degrees Brix. For each of the 18 varieties for which sugar standards have been approved, the negotiated price is the base price to which the sugar content adjustment is made. The base price for sugar content is determined by the running five-year average for each variety. The price adjustments can range from 50% to 125% of the base price depending on sugar content.