Fine little wine industry that B.C. has going here. Be a shame if something happened to it.
That about sums up the sentiments that Alberta Premier Rachel Notley expressed on Tuesday when she announced that her province would “put an immediate halt on the import of B.C. wine into Alberta.”
Coverage of Rachel Notley’s economic threats against B.C. on Globalnews.ca:
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Rachel Notley announces Alberta will stop importing BC wine -
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Alberta Premier Rachel Notley hints at economic retaliation towards BC
But she didn’t stop there. At a news conference, she mused about banning imports of B.C. beer, too.
“Alberta imports a heck of a lot of beer from B.C. and it would not actually be a bad thing for Alberta should more Alberta beer be drunk,” she said.
“So that is a thing that we are also looking at right now.”
READ MORE: Alberta to stop importing B.C. wines into the province: Notley
Notley’s announcement came in response to B.C. saying it would ban increased shipments of diluted bitumen off the West Coast. And it rattled B.C.’s wine industry.
The B.C. Wine Institute said in a statement that it was “shocked that the Alberta premier and government are aggressively boycotting B.C. wineries over a yet-to-be-determined British Columbia government policy in a different sector.”
The institute noted that 30 per cent of all wine sold in Alberta is from B.C., and that it has a retail value of $160 million.
It went on to say that Alberta is the “second most important market for B.C. wine (behind B.C. itself).”
And numbers gathered by Statistics Canada back up concerns that B.C. could lose in Alberta a major export market for its wine — and possibly its beer, too.
This chart shows B.C. exports of wine and brandy to other provinces from 2010 to 2014, in basic prices ($ in thousands):
B.C. exported more than $270 million of wine and brandy to Alberta from 2010 to 2014, according to trade data gathered by Statistics Canada.
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And the numbers were on an upswing in that time period. In 2011, B.C. exported $49,554,000 worth of wine and brandy to its neighbouring province; that grew to $60,677,000 in 2014.
This chart shows the share of wine and brandy exports that B.C. sent to various provinces in 2014, in basic prices ($ in thousands):
Notley’s boycott also came at a time when wine sales have steadily increased in Alberta.
Sales of wine were at just over $261 million in 2004/2005. That number climbed every year to reach over $601 million in 2015/2016, according to StatsCan.
READ MORE: B.C. premier vows province will respond to ‘unfair’ wine boycott
Alberta also represents a major destination for B.C. beer within Canada.
From 2010 to 2014, B.C. sent over $565 million in beer to Alberta, more than any other province, according to the statistics.
That represented about a 68 per cent share of the beer that it exported interprovincially in that time.
This chart shows B.C. exports of beer to other provinces from 2010 to 2014, in basic prices ($ in thousands):
Any move to end wine or beer imports from B.C. could potentially hurt profits or jobs proportionally to the amount of product that was being shipped to Alberta, Richard Harris, a professor of economics at Simon Fraser University (SFU), told Global News.
However, in the long run, “damage would be much, much less as wine sales would go to other markets fairly quickly,” he added.
The exception, he said, would be craft beers from eastern B.C. “for whom Alberta is a much more important market,” Harris said.
READ MORE: Albertans are B.C.’s 3rd biggest tourism spenders. Could trade war put that at risk?
Meanwhile, UBC Prof. Werner Antweiler, who focuses on international trade, said wineries in B.C. stand to lose approximately eight per cent of their revenue of Alberta stops imports of their wine.
“That is bad news but ‘survivable,'” he said in an email.
“Fluctuations of this magnitude are not unusual as markets change and supply varies with annual weather and growing conditions.”
Antweiler said that if Alberta blocks sales of B.C. wine and there’s an excess in B.C., “surely prices will drop a bit and boost local demand.”
‘Political grandstanding’
Ultimately, he said Notley’s ban is “political grandstanding,” and that it “remains to be seen if this measure is implemented as announced.”
“By choosing wine (and possibly beer), Notley has picked a ‘high visibility’ item that stands out while at the same time not straying too far from the interprovincial trade restrictions on alcohol we’ve seen in the past.”
But that “grandstanding” hasn’t just put industry on edge.
It’s also concerned politicians who say they’re standing with B.C.’s wine producers.
“I urge Alberta to step back from this threatening position,” B.C. Premier John Horgan said Tuesday.
Meanwhile, B.C. Agriculture Minister Lana Popham said the ban would “unfairly” hurt businesses in the province.
Restaurants Canada, an industry organization, said the ban is “using Alberta consumers and B.C. businesses as pawns and dragging them into and pitting them against each other in a provincial trade war.”
“As a country, we are trying to strike down domestic and international trade barriers and this decision moves us in the completely wrong direction,” Western Canada vice-president Mark von Schellwitz said.
- With files from Emily Mertz and Richard Zussman
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