Unless Canadian wines are given better access to the European Union, the Liquor Control Board of Ontario (LCBO) should cut back on its purchasing of wine and liquor from Europe and buy elsewhere, Ontario Consumer and Commercial Relations Minister Robert Runciman said yesterday.
Mr. Runciman said European curbs that prevent Canada from selling more than a token amount of table wine and completely ban the sale of ice wines are totally unacceptable, but after talks with European trade officials he saw no sign of them being altered.
"We cannot let the situation fester and they seem to be prepared to let it fester," he said in an interview at the end of a trip to Brussels.
Mr. Runciman said the key to Canada getting action is to use the LCBO, the largest single purchaser of European wine in the world, as a bargaining chip in its negotiations and begin by restricting the sale of certain imports such as European dessert wines. "What incentive is there for them do anything when they have free, unfettered access to our market? We must start treating them the way they treat us," he said.
Last year, Canada imported $545-million worth of wine from Europe, of which Ontario accounted for $325-million.
A minuscule amount of wine went the other way since the EU treats Canada as a small wine producer and limits Canada's annual sales to Europe to just 1,000 hectolitres. The value of all Canadian shipments was just $438,000, a figure that has been falling in recent years.
For Europe to import more Canadian wine, the Europeans insist Canada comply with the strict rules and standards set for wine making in Europe. The EU says Canadian ice wines cannot be sold in Europe because they contain more than 15 per cent "total alcohol." In fact, Canadian ice wines contain only about 11 per cent alcohol, but the 15-per-cent calculation is based on what would happen if all the sugar content were to ferment completely -- something that almost never occurs.
The same restriction has been waived for ice wine from Germany and Austria, which has the same residual sugar as the Canadian product.
There has also been a long-standing dispute between Europe and other wine producers including Canada over the use of traditional names such as champagne, port and sherry or appellations like Chablis or Sauterne. In negotiating a recent trade deal with South Africa, the Europeans came up with 150 "traditional expressions" that they wanted protected and insisted the South Africans ban the use of ouzo and grappa even though they do not produce any.
According to Bruce Walker, chairman of the Ontario Wine Council and executive vice-president of Vincor International Inc. of Mississauga, the Ontario wine industry has complied with international trade rulings on the use of appellations and traditional names and is prepared to sit down and resolve further differences with the Europeans in return for recognition of Ontario's VQA quality label and better access to what is now a closed market.
He estimated that, if the European market were opened up, Canadian wines, led by its ice wines, would have sales of $40-million to $60-million annually.
Mr. Runciman said Canada appeared to receive different treatment than other so-called New World wine producers such as Chile, Argentina and New Zealand, which were able to export freely to Europe while they negotiated differences over wine-making practices and the use of traditional names.