Grape growers and wineries agreement calls for grape price increase

Wednesday, June 29, 2016

by SUSAN MANN

Ontario’s grape growers and wineries reached an agreement almost a month ahead of schedule calling for a two per cent overall grape price increase, and that gives farmers and buyers more time to plan for this year.

Allan Schmidt, Wine Council of Ontario chair, says regulations under the province’s Farm Products Marketing Commission stipulate the negotiations must be completed by July 31 annually. This year the Grape Growers of Ontario, the Wine Council of Ontario, and Winery & Grower Alliance of Ontario reached an agreement by late June.

Schmidt says, “We wanted to conclude them earlier because this actually gives a lot more certainty to growers and wineries to start planning their purchases for this fall.”

Harvest is anticipated to be a week to 10 days earlier this year compared to other years  “because of all the hot weather we’ve had,” he notes. And the crop size will be at normal to possibly record levels. The grape crop is also looking like it will be high quality due to the extensive hear.

During the past two years the crop was about 52,000 tonnes because of the cold winters. However, this winter was quite balmy.

This year’s grape harvest may be of average size, at about 70,000 tonnes or possibly higher. A record crop would be about 77,000 tonnes.

“It could be a record crop this year, but we won’t know until we harvest it,” he says. “We’ve had two really bad years so it’s hard to estimate what grapes are out there.”

About the price increase, Schmidt says there are about 30 different grape varieties and “we’re not obligated to have the same percentage (increase) on each variety. We basically agreed we’d just do a flat two per cent on all varieties. It’s a cost of living increase for the grape growers and I’m okay with that.”

The agreement also extends the six-year plateau-pricing program for another year. The program enables wineries to pay less for grapes with lower sugar content for four grape varieties — Riesling, chardonnay, cabernet franc and cabernet sauvignon. They’re the four most prominently planted grape varieties.

In some years there is a lot of those varieties available. Some large wineries will use those varieties for their international Canadian blends, which have wine made with Canadian-grown grapes mixed with imported wines.

“These are the more value-priced wines,” Schmidt says.  

Patrick Gedge, president and CEO of the Winery & Grower Alliance of Ontario, says under the plateau pricing program there are two prices for the four varieties – one for grapes going to make VQA wines and the other for grapes going into lower-priced wines.

Wineries and their growers determine ahead of time which grapes and pricing schedules “they’ll be using,” he notes.

The program “increases the number of grapes being bought,” he notes. “The major objective is we all want to try to ensure that all the grapes grown in Ontario are purchased and used in wine.”

Both Gedge and Schmidt say this year’s grape crop looks very good. Gedge says the grapes are growing “phenomenally well so far this year. That will help balance two years of relatively small crops.”

The lack of rain in Ontario recently hasn’t hurt the crop because farmers have water sources to irrigate their crops, Gedge notes. However, everyone wouldn’t mind some rain. BF