Evidence of meeting #52 for Agriculture and Agri-Food in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was provinces.
A recording is available from Parliament.
4:50 p.m.
Conservative
4:50 p.m.
Conservative
The Chair Conservative Bev Shipley
I will now go to Mr. Keddy from the Conservatives for five minutes, please.
4:50 p.m.
Conservative
Gerald Keddy Conservative South Shore—St. Margaret's, NS
Mr. Chairman, I'll share my time with Mr. Payne.
Ms. Zimmerman, thank you very much for your submission.
I'm struggling a little bit here. I listened to you, and you had a concern when we passed the bill that it should have been for only Canadian wine. But the reality here, I would expect, is that there would be very little foreign wine shipped across the border into Canada, just because of geography.
4:50 p.m.
Chief Executive Officer, Grape Growers of Ontario
Are you asking me to comment?
4:50 p.m.
Chief Executive Officer, Grape Growers of Ontario
Okay.
No, I think that alternatively, if there is trade.... One thing about having trade barriers, obviously, is the reduction in tax or in any taxes that would be paid among the provinces. If there's any avenue for wine to travel freely, whether it's imported or domestic, a good business person will take advantage of that. I wouldn't suggest that anybody wouldn't or shouldn't; certainly if there are fewer trade barriers, fewer tariffs being applied across provinces, imported and domestic certainly will take advantage of that. Our point has always been that with 68% importation, they're already being advantaged. The reason I pointed out a marketing strategy, which I still think is important, is that it gives us a little bit of a leg up in our own marketplace to try to beat those odds, going from 68% of imports to challenging that, with our own 30% moving to 50%.
4:55 p.m.
Conservative
Gerald Keddy Conservative South Shore—St. Margaret's, NS
Yes, and I appreciate that, but with the marketing strategy it seems to me that you still have a problem, and we still have a problem throughout the country, with our liquor boards. Until that problem is solved, we won't get anything else done. I said the same thing to Mr. Paszkowski, that ultimately it has to be the provincial political leadership that takes charge of this file and forces the liquor boards to open up. That will then allow the growth of the industry.
I'd like a short answer on that. Is it an oversimplification?
4:55 p.m.
Chief Executive Officer, Grape Growers of Ontario
Respectfully, I think it is.
Certainly, what we need to be doing is cultivating that consumer demand for our product. That consumer demand is what's going to open up those liquor boards. In a marketing initiative, which we're asking for, we're asking you to reinvest as we have invested in this country, in the land here in Niagara, and the land in Ontario, as growers, as farmers, as winemakers. Take some of the revenue you're currently collecting from us and put it back into a marketing strategy to create that demand, which will force the liquor boards to back down on this policy.
Quite honestly, I think the strategy has to be in reverse. We're looking to you for some support for the future in helping Canadian wineries and Canadian growers be successful in their home market.
4:55 p.m.
Conservative
4:55 p.m.
Conservative
LaVar Payne Conservative Medicine Hat, AB
Thank you, and I thank my colleague for his time.
It's interesting, because I did have a bit of a tour in Niagara last summer and was fortunate to taste some of those good wines down there.
4:55 p.m.
Conservative
LaVar Payne Conservative Medicine Hat, AB
You talked about the foreign wine flowing into the provinces here. It sounds as if it flows freely into the provinces, whereas it's much more difficult for Canadian vintners to send their wines to the provinces because of all the liquor boards. As my colleague points out, that requires the political folks in the provinces to actually make their stand on that.
My question is whether, because there is so much foreign wine coming into Canada, the Canadian vintners and wine growers can be competitive with those foreign wines, even though they're coming into the provinces without the same kinds of barriers our wineries have here in Canada.
4:55 p.m.
Chief Executive Officer, Grape Growers of Ontario
I think I mentioned it in my presentation. I'm sorry. I have only a minute or so to respond, so to not repeat myself, what I pointed out and the Canadian Vintners Association has pointed out is that many of these foreign wines come with the support of their home markets. Most of them have a fantastic marketing program and they're getting that kind of support. I think that's the difference here. We're saying, can we be competitive in value and price and quality? Absolutely. We've already seen that.
The limiting factors seem to be more about how we're treated as a domestic product. We need to be treated fairly and the same as other countries that already own 90% of their market share at home first: California, 63%; Australia, 90%; New Zealand, 57%. We're at 30%. How dismal that is.
Can we be competitive? Not when we're not getting the support from the people who collect the taxes from us federally and provincially.
The interprovincial trade barrier is only a small aspect of what needs to be done to grow our market share domestically.
4:55 p.m.
Conservative
The Chair Conservative Bev Shipley
Thank you very much, Mr. Payne.
Now we go to the Liberals. Mr. Eyking, please, for five minutes.
4:55 p.m.
Liberal
Mark Eyking Liberal Sydney—Victoria, NS
Thank you, Debbie, for attending today.
It seems the previous witness we had also talked about what's needed in the marketing in Canada. With the present government you have a program called Growing Forward. You'd think that would be a fit.
There is a concern that there's a 10% cut in the agriculture budget now. Maybe they're not willing to go that way.
Can you expand on what kind of program you're talking about? How many dollars are you thinking about? Would it be the federal government taking the lead, with some provincial money? How much money would come from your group? Do you have a national organization that would pull this together?
Can you give me some details on that?
5 p.m.
Chief Executive Officer, Grape Growers of Ontario
Yes, certainly.
The Canadian Vintners Association is probably one of the appropriate representatives.
I'll give you a quick idea. I think we're all willing to step up and be contributors towards a marketing program, but we need that support federally, because in Canada we don't get that currently in terms of marketing dollar support.
You don't have to take my word for it. Someone could probably do some research to show what kind of support they're getting in other countries.
If you go to France, it would be tough to find an imported bottle of wine anywhere. Maybe it's because there's this allegiance to their country. We just don't have that yet here in Canada. I think because we are fairly young, we have an opportunity to grow. Having support at home would be the first step.
In terms of the value of the program, there are all sorts of iterations we could put forward. I would leave those details to everyone to participate in and come up with a strategy.
5 p.m.
Liberal
Mark Eyking Liberal Sydney—Victoria, NS
When you visit a liquor store, many times when you walk in you don't see the Canadian products. You would think there should be priority aisles, and a much better job of that. What happens there? Are there kickbacks—
5 p.m.
Liberal
Mark Eyking Liberal Sydney—Victoria, NS
—or rebates for that wine coming in, for shelf space, for labelling? Is that what's happening?
5 p.m.
Chief Executive Officer, Grape Growers of Ontario
No, if you go into most Ontario liquor stores, you'll see that there is a very dedicated section to VQA wines. Distribution is always tough. Obviously, when you're deriving a lot of your revenue from taxes, and you have this open market system and a monopoly at the same time, it's probably tough to do.
What we need is to have consumers demand our product. We're not afraid to be competitive, but we need our consumers to demand our product. As I said earlier, you have these countries coming in with huge subsidies from their own home markets in the first place, so by the time the bottle of wine gets to Canada, they've had a ton of support. We're looking for the same in our own domestic market.
Going back to our request, while we are dealing with the potential of trade barriers, we need consumers to demand our product, and that comes from their seeing it on the shelf or, in fact, through marketing campaigns that are supported by the federal government and the provincial government, which—
5 p.m.
Liberal
Mark Eyking Liberal Sydney—Victoria, NS
When the NAFTA deal was happening, as you may be well aware, there was federal government money to help, but a lot of that went to new varieties and machinery—
5 p.m.
Liberal
Mark Eyking Liberal Sydney—Victoria, NS
—but now we are in another stage. We can grow it. We have the varieties. We have the wine.
