Provinces must eliminate barriers to liquor sales, Alberta distillery association says
Published on: May 16, 2017 | Last Updated: May 16, 2017 6:00 AM MDT
Canada should eliminate interprovincial trade barriers making it hard to sell products nationally from Calgary's Alberta Distillers, shown here, and other liquor made by major distilleries in the province, Spirits Canada says. GAVIN YOUNG
Alberta should push other provinces to eliminate trade barriers that make it hard for Canadian distilleries to compete internationally, the head of the industry association says.
Access restrictions and unfair tax rules block companies from developing the strong domestic market they need to grow big enough to take on large firms from other countries, Jan Westcott, chief executive of Spirits Canada, said Monday.
“When we try and ship our products across the country … they face all kinds of discrimination,” he said.
“We basically take Alberta grain, convert it to alcohol and add a huge amount of value by branding it and exporting it around the world.”
The interprovincial free trade deal reached last month doesn’t cover booze, which will be studied by a working group set to report back July 1, 2018.
Alberta has the most open system in Canada, said Westcott, who’s in Edmonton this week speaking at an Alberta Enterprise Group reception.
He wants provincial officials on the committee to work toward reforming a system he said is hurting his industry.
Provinces have been increasing barriers to liquor from other jurisdictions over the last five to seven years as they seek to create and protect the growing number of craft distilleries, he said.
“Every province is different. That just adds to the cost of doing business. That makes it much more costly and difficult to sell across the country.”
Alberta has Canada’s second-largest distilling sector behind Ontario, with major plants in Calgary, High River and Lethbridge employing a total of 300 to 400 people, he said.
These facilities exported about $80-million worth of whisky and other products last year, but Westcott said there’s potential for that figure to grow to $200 million.
He doesn’t expect distilleries to close and production centralized if the rules are loosened.
The recent Alberta budget included plans to develop a program for craft distillers similar to the one for craft breweries, which receive up to $20 million in grants annually.
No details have been released, but Westcott, whose organization doesn’t cover small producers, said he accepts such schemes as long as they only last a few years.
“I have no issue with governments wanting to give people a hand up to get into the business. The experience has been once they are in, they outlast their usefulness.”
David Farran, president of the Alberta Craft Distillers Association, said he agrees with Westcott that a level playing field would be better, particularly when provinces such as Ontario make it difficult for outside companies to get shelf space.
But he doesn’t expect rapid action, although he is pleased with the government’s promise to assist Alberta’s 11 small distillers.
“The feasibility of (removing barriers) happening quickly, it’s not visible on the horizon. I do think in the meantime there’s a need to have a program to help foster crafts … because we have been held behind. We will need an incubator program to get it going.”