A plea for prudence from Ontario’s vibrant wine industry

In the heart of Ontario, a story unfolds — one of agricultural heritage, hard work, and economic prosperity, all bottled up in the world of wine. Between 2011 and 2019, Ontario’s wine industry poured a staggering $5.5 billion into the province’s bank accounts, providing over 23,000 people with jobs.

This success is no accident. It’s the result of years of hard work, and it depends on sales channels that let Ontario wineries reach Ontario consumers — notably the LCBO and our neighbourhood wine shops.

Now, storm clouds gather. Rumoured changes to this sales model by Doug Ford’s government will shake the core of Ontario’s wine and grape growing industry.

The premier is apparently considering handing over control of wine retail to the grocery giants, trading away local jobs for “consumer convenience.”

It’s not that consumer convenience isn’t valuable. But how much convenience will consumers really gain if a few big stores control what wine they can buy? And at what cost? We need to be extremely cautious handing over control of wine retail.

Look around. Five retail giants — Loblaw, Sobeys, Walmart, Costco, and Metro — have their fingers in nearly 80 percent of Canada’s grocery pie. This isn’t just dominance; it’s a virtual oligopoly.

With such power comes the ability to wield it to the detriment of domestic manufacturing and processing. Kraft Heinz in Leamington, Kleenex in Huntsville, Kellogg in London — the impact of the grocery oligopoly, was part of the rationale for making these strategic business decisions to withdraw manufacturing from Ontario. With it, thousands of workers lost their jobs and these communities lost their major employer.

On top of that, recent years have witnessed an alarming 20 percent surge in product placement costs on Canada’s store shelves. In the same time frame, our neighbours to the south have seen no such rise.

A recent survey of Food, Health & Consumer Products of Canada members shed light on a worrying 25 percent hike in retailer-imposed fines. This isn’t just about numbers. It’s about stifling local industry.

Believe it or not, over 80 percent of branded products now on Canadian store shelves trace their origins to other markets outside Canada. When our local businesses are gasping for air, struggling against mounting fees and unpredictable pressures, where is the space for homegrown loyalty?

Let’s spare a thought for the little guys. Ontario’s food and beverage landscape is dotted with around 4,000 food and drink businesses, most small-scale with under 100 employees. Ontario’s wine sector reflects this very entrepreneurial spirit. Now, wineries and grape growers face an uphill battle in this volatile retail environment. Need evidence? A poignant April 2023 Toronto Star article paints a grim picture of these bullying tactics.

Canadian manufacturers and food processors have learned to their detriment how the grocery oligopoly can squeeze out Canadian products on store shelves sending innovation — and jobs that go along with it — south of the border. The Ford government should think very carefully before it unleashes the same forces on Ontario’s homegrown wineries and grape growers.

We stand at a pivotal juncture. As the bedrock of Ontario’s agri-food, tourism, and hospitality sectors in Niagara, Lake Erie-North Shore and Prince Edward County, the wine industry’s significance cannot be understated. This isn’t just about wine; it’s about preserving a legacy.

As we raise our glasses to the future, let’s ensure the value of Ontario’s wine remains undiluted and protected so it can continue to grow and prosper.

(Please note: This op-ed was published in the September 13, 2023 edition of the Hamilton Spectator.)