Alberta aims to foster growth of small liquor manufacturers with reduced markups

A file photo of Strathcona Spirits, Edmonton's first distillery. Global News

Just in time for the holidays, the Alberta government has reduced markups on small liquor manufactures when selling their products at farmers’ markets or at their manufacturing facilities.

Beginning Friday, the province says the markup rate for eligible producers will be reduced by $11.21 per litre to $2.46 per litre for spirits and reduced by $1.49 to $0.32 per litre for refreshment beverages, such as coolers and ciders.

The Alberta government defines a small liquor manufacturer as one that produces under 1,500 hectolitres of spirits.

READ MORE: Alberta finance minister announces changes to province’s liquor policies

Watch below: In August 2017, Alberta Finance Minister Joe Ceci announced the province will allow craft beers and spirits to be sold at approved farmers’ markets.

Click to play video: 'Alberta to allow craft beers, spirits to be sold at farmers’ markets'
Alberta to allow craft beers, spirits to be sold at farmers’ markets

David Farran, president of Eau Claire Distillery in Turner Valley, Alta., said his business began during the dawn of the industry three years ago.

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He said cash flow is not easy to come by and welcomed the announcement.

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“It requires such a high capital investment. When you’re making whiskey, you’re putting it away for at least three years.”

Farran said the reduced markup rates will put producers like Eau Claire Distillery on a level playing field with the other provinces which have similar programs.

“It puts us back in the competitive game,” he said.

READ MORE: Alberta’s first craft distillery set to open in Turner Valley

Watch below: A report from March 2014 about Alberta’s first pure-craft distillery getting ready to open its doors.

“That’s about an $11 advantage for every bottle of liquor that they self-distribute,” Finance Minister Joe Ceci said. “We believe that Alberta’s small liquor manufacturers play an important role in creating jobs and building a diversified economy. This program will allow manufacturers to hire staff, expand production and reinvest in their businesses.”

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The president and CEO of the Alberta Gaming and Liquor Commission also said the markup changes will help support Alberta’s spirit and refreshment beverage producers.

“Alberta has a long, proud history producing spirits from our world-class grains,” Alain Maisonneuve said in a news release. “Our larger distilleries that have been in operation for decades are instrumental to Alberta’s liquor landscape. Since we lifted the minimum production requirement, we’ve seen tremendous growth in this sector with new, small distilleries joining the proud tradition of our established large manufacturers.”

READ MORE: After much anticipation, Edmonton’s 1st distillery opens to the public

Watch below: Video from November 2017 in which veiwers got a look inside the Strathcona Spirits distillery.

Click to play video: 'Edmonton’s 1st distillery open to the public'
Edmonton’s 1st distillery open to the public

Overall, Alberta currently has 103 liquor manufacturers (large and small). Of those, 21 are spirits manufacturers.

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The government said the markup changes are expected to return about $1.4 million to manufacturers in the next fiscal year.

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