Ontario's grape growers, wineries extend pricing agreement

Thursday, February 2, 2012

by DAVE PINK

The Grape Growers of Ontario has reached a new two-year pricing framework agreement with the Winery and Grower Alliance and the Wine Council of Ontario, it was announced Friday.
 
The new agreement, based on the plateau pricing model introduced to the industry two years ago, will optimize growing opportunities for the province's grape producers while guaranteeing supplies of varying grape qualities to Ontario's wineries, says Debbie Zimmerman, CEO of the Grape Growers of Ontario.
 
"It ensures that growers can grow as much tonnage as they are able to at a flat price," she said. "It has helped take our industry from one where we had surplus production to one of stability."
 
And, "it creates more opportunities for the wineries to buy grapes at various price points."
 
Up until two years the province's growers often found that they were producing too many grapes, said Zimmerman, but the new pricing framework has changed that. A 2010 Grape Growers news release defines plateau pricing as setting a minimum price for grapes that are below an agreed level of sugar content and providing higher prices for grapes with higher sugar content.
 
Actual prices for all varieties this year are still to be negotiated.
 
The plateau pricing model will be applied to four grape varieties – chardonnay, riesling, cabernet franc and cabernet sauvignon. BF