B.C. growers faring well despite global grape glut

Relationship with local wineries cited
  
B.C. grape growers may have dodged a bullet that's causing large price reductions for international and Ontario growers due to a glut of grapes on the market.

"You won't see the drop that Ontario is seeing," B.C. Wine Institute general manager Lisa Cameron predicted in an interview Wednesday. "Prices for grapes will either remain stable or, if they do go down, drop slightly."

Cameron also said that this year's crop in B.C. is looking pretty good.

Grape growers around the world, including California and Australia, are suffering from price reductions as high as 40 per cent because of a worldwide glut that's resulting in many grapes being left on the vine to rot. Ontario has also been hit by the downturn.

However, Cameron and several provincial wineries and grape growers said that hasn't happened in B.C., where growers have a much closer relationship with the wine makers.

"In B.C., 70 per cent of the planted acreage is owned by the wineries, so they can control the production and quality of the grapes," she said. "Because of this, the remaining 30 per cent work very closely with the wineries and work almost like partners. Many signed contracts three, four or five years ago."

She said it's different in Ontario, where there are more independents than wineries, and independents often grow too many grapes.

"In Ontario, only 30 per cent [of the grapes] are owned by the wineries, 70 per cent by independent growers. We also have direct control of the vineyards so high quality can be maintained," Cameron said.

"Here, because B.C. wine sales have been so strong over the last five years, wineries that needed extra grapes made long-term contracts with growers. We just didn't keep planting and planting, thinking there'd be this huge market for our grapes."

Despite that, Cameron said local growers could still notice a slight drop in prices because wineries have been forced to cut costs to compete with cheaper foreign wines.

Of the state of B.C.'s current crop, Cameron said: "We had a delayed spring, but once the warm weather started we had sustained warm, dry weather and it brought the crop back into line. We're looking at a very healthy crop, slightly bigger than last year.

"[And] we're a week ahead of last year with the harvest."

Bob Ferguson, part-owner of Kettle Valley Winery in Naramata, said that he hasn't heard of any glut of grapes in the Okanagan. "As far as I'm aware, there's a glut of grapes in Ontario, but I haven't seen it in B.C. Prices [of grapes] are definitely holding steady and have increased over last year."

Bill Eggert, owner of Fairview Cellars in Oliver, agreed. "There's a bit of a glut in Ontario, but not here. The prices I'm hearing is $3,000 a ton, which is really good."

Connie Bielert, of the B.C. Grapegrowers Association, which represents 220 growers across the province, said that for the most part members have had little trouble selling grapes to wineries. "With the general economy, cash flows have been reduced. But I haven't heard a thing about [price drops]."

Meanwhile, Cameron also said a simple way for consumers to know that they're buying a wine made from 100-per-cent B.C.-grown grapes is if it has a BCVQA label, standing for B.C. Vintners Quality Alliance.

Consumers have expressed considerable concern over revelations that imported bulk wine is being labelled and sold as B.C. wine.

"Cellared in Canada" appears in fine print on the back label of some of the wines sold by the big three Canadian winemakers: Vincor International, owner of the Jackson-Triggs label; Andrew Peller Ltd., owner of Peller Estates; and the Mark Anthony Group, owner of the Artisan Wine Group and its Sonora Ranch and Painted Turtle brands. Other wines, often with similar labels but at a higher price, are genuine B.C. wines.

All three winery businesses buy bulk wine from cheap sources outside Canada, bottle it here and sell it in the B.C. wines section of government liquor stores.

Cameron said the wine industry is worth about $165 million in sales annually in B.C., and another $33 million outside B.C.