Monday, April 04, 2011

Wine Making and Winery Ownership in BC - A pastime for the wealthy?

After being in this industry for more than 15 years and observing how things work, I'm beginning to suspect that making wine for a living in this jurisdiction is an activity reserved for the rich.
This in itself is not a revelation.
I'm not talking about the day-to-day labour in the cellar or the vineyard.  By wine making I'm suggesting the ownership of land and facilities in order to do so.
It's becoming clear that the regulations for operating and licensing a winery favour those with substantial financial clout and basically keep people of modest means from playing any significant role. I think some of those restrictions have been created for the sole purpose of restricting the number of players in the field and to promote the BC government's long time agri-tourism push.
And this kind of environment limits innovation, new blood and a free market.
Considering the price of land in BC, it would require a minimum of $300,000 just for dirt for a land-based winery license.  That's before equipment, agricultural costs and infrastructure.  One could entertain a 'commercial' winery license, but that's just basically an extension of the BC Liquor Distribution Board's retail system.  You'd miss out on the great system of kick backs given to land-based wineries that produce VQA products.
Next add in the licensing requirement for a 500 case annual production.  This artificial constraint means you'll be looking at a minimum of 8 tons of grapes (about 60 cases per ton) at a cost of somewhere between $1200 to $3,000 per short ton. Let's split the difference at $2100 per ton or about  17 grand right out of the gate.
The point is: if you're a good winemaker who would just like to buy some grapes, make some wine and sell it on the open market: you're out of luck.  
Why should there be some arbitrary number for production? What has that got to do with great wine?

I queried friends in other jurisdictions.  My contact in California knew of no constraint in the size of the operation while in Ontario another friend suggested things may be even worse.

There's no system to allow shoestring operators to simply take part in the market. I propose licensing follow the precedents set be the food industry.  The priorities should be about good sanitation, proper disposal of waste and other environmental concerns in concert with local requirements.  Not some made up number for case production and the requirement for tracts of land that may be the most expensive agricultural land in Canada if not all of North America.
It's time this lazy, bourgeois style of licensing was changed to allow innovative and dynamic new producers.

3 comments:

Jeannette said...

Thank you for outlining this structure for consumers to better understand some of the constraints of smaller producers in BC. We get bits and pieces, but this really takes us through the hurdles.

It makes so much sense for a regulatory body to care more about the quality and safety of an industry, rather than the volume.

Ryan said...

I like your critique. Shout it loud!

You're right that it's far far worse in Ontario. Here there are tougher restrictions on minimum acreage; 5 acres under production to be able to be allowed to have a winery retail store license, for example. And the VQA allowed varietal list is discriminatory against areas outside of Niagara that want to experiment with new varieties.

Bo Knows said...

Brad, I'm fully behind you. As a consumer and a big fan of the Okanagan wine industry, I want to see more guys like you starting new ventures here, to give the consumer more choice and to add more colour to the market. Otherwise everything is going to be Mission Hill, Vincor, Peller, etc. The big guys ar not a bad thing as long as there are nots of other choices.
I think the BCLDB's job should be to facilitate the BC wine industry, not frustrate it.