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B.C. wine industry disappointed over USMCA-related grocery store sales changes

B.C.B次元官网网址檚 wine industry will soon lose its advantage of dedicated grocery in-store shelf space
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Dirty Laundry winery in Summerland, B.C., estimates it will sell fewer bottles of red and white in grocery stores as shelf space previously reserved for local companies will soon be shared with U.S. imports.

B次元官网网址淚 donB次元官网网址檛 think itB次元官网网址檒l be devastating, but it will certainly impact us,B次元官网网址 said Paul Sawler, the wineryB次元官网网址檚 director of sales and marketing.

B.C.B次元官网网址檚 wine industry will soon lose its advantage of dedicated grocery in-store shelf space B次元官网网址 a practice deemed discriminatory through the lens of U.S. President Donald TrumpB次元官网网址檚 America-first ethos B次元官网网址 as grocers will have to make room for out-of-province offerings.

But with the Nov. 1, 2019 deadline for implementation more than a year away, those in the industry say itB次元官网网址檚 difficult to know what the change will look like and just how hard itB次元官网网址檒l hit local vintners.

Imported wines currently can only be sold at the provinceB次元官网网址檚 grocery stores in a so-called store-within-a-store model, which the U.S. has called discriminatory and complained about to the World Trade Organization alleging unfair sales practices.

The U.S. and Canada agreed to end the B次元官网网址渙ngoing trade concernB次元官网网址 in a pair of side letters to the new United States-Mexico-Canada Agreement reached late Sunday night.

The change is not surprising, but is disappointing, said Miles Prodan, the CEO of the B.C. Wine Institute, a not-for-profit organization that represents the interests of the provinceB次元官网网址檚 wineries.

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There are 271 licensed grape wineries in the province, according to the institute, and the industry contributes $2.8 billion annually to the B.C. economy.

The majority of the wineries are small in scale, he said, producing about 5,000 cases a year or less.

The grocery-store model was the only real channel many of these smaller operations had to access consumers, he said.

B次元官网网址淭he growth of the sales for small wineries increased significantly,B次元官网网址 he said.

B次元官网网址淧rior to that, and it continues to be, very difficult for small wineries to access retail stores,B次元官网网址 he said, adding everyone, including foreign wines, beer and spirits, is fighting for limited space within existing stores.

For Dirty Laundry, which this year will produce 30,000 cases, itB次元官网网址檚 not a critical source of sales, but an important market and the wineryB次元官网网址檚 fastest growing one, Sawler said.

It accounts for 15 per cent of the companyB次元官网网址檚 sales in the province, not including on the vineyardB次元官网网址檚 premises, he said. The company anticipates its sales in the channel will fall as a result.

B次元官网网址淏ut how much it will impact us? You know, itB次元官网网址檚 anybodyB次元官网网址檚 guess at this point,B次元官网网址 he said, adding a lot depends on how the grocery chains handle the change.

The grocers themselves donB次元官网网址檛 yet know what the future will look like.

Only 29 grocery stores in the province sell B.C. wine in aisles as the practice requires a special licence.

Save-On-Foods offers provincial wine at 19 of its stores.

B次元官网网址淲e donB次元官网网址檛 believe this change in legislation will affect our operations and it definitely does not affect our long-standing commitment to supporting our local B.C. wineries and the B.C. agri-food industry,B次元官网网址 the chain wrote in an email.

Loblaw Companies Ltd. sells B.C. wine at 10 of its stores, but doesnB次元官网网址檛 have any further licences and thus no plans for expanding the practice at the moment, spokeswoman Catherine Thomas wrote in an email.

The company doesnB次元官网网址檛 have enough information about the changes to provide any comment on how its in-store wine stock will change come November 2019, she said.

Aleksandra Sagan, The Canadian Press

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