A news item in the trade press this past week reminded me of a renewed agreement concluded in February between the Grape Growers of Ontario and Ontario wineries (represented by the Wine Council of Ontario and the Winery and Grower Alliance). This agreement continues a pricing practice negotiated in 2010 where base prices for selected varietals that meet minimum sugar levels are established early in the growing season (late April/early May).
The goal of this system is to provide certainty for growers and to give them a basis for making decisions later in the growing season – do I do a green harvest to reduce yield but improve fruit concentration? Do I pick now or wait a few days for sugar levels to increase? The intent of this system is to minimize grape surpluses which have become a blight on growers across the winegrowing industry, worldwide. This is especially important if the set-pricing model encourages wineries to buy local grapes before they consider purchasing imported grapes. Similarly the local grower community has better assurance about its revenues, an important contributor to industry stability.
In this regime prices increase as sugar levels increase, so there is incentive to let grapes hang longer before picking but if weather conditions suggest a delayed harvest will be damaged by cold or rain then the grower knows they will receive the base price as long as the minimum sugar content is achieved.
This system is euphemistically called plateau pricing. Put another way this system provides a floor price that will encourage high volumes per acre and grapes that are of poorer quality. Note, this is a floor price. That is, the lowest price a grower will accept if he/she meets minimum sugar content. The goal is to deliver grapes, maybe barely ripe, to wineries who want to make low-priced wine.
This regime applies to only four varieties at the present time: Chardonnay, Riesling, Cabernet Franc and Cabernet Sauvignon. Cabernet Sauvignon is an odd variety to include in this scheme: the Ontario climate is cool enough that it can be difficult to achieve full phenolic ripeness with CS if the growing season is short and/or cool. Why include a grape that is at best marginal in this agreement? Instead we should encourage cultivation of those grapes that are emerging as Ontario champions, such as the other three grapes in the formula along with Pinot Noir… politics… farm lobby… industry fragmentation… roadblocks. Welcome to Ontario!
Generally, Wine Ontario is on a positive trajectory. Wine quality has improved as vinifera vines planted in the 1990’s mature into their productive years. Grape quality is improving as we better understand which varieties prosper in our challenging climate and soil conditions. Winemaking has improved dramatically as our winemakers are more qualified – in terms of academic credentials and global experience, both.
This deal seems keen to undue the progress we have made, especially when it comes to grape quality. I have previously written about a troubling aspect of Ontario wines, namely the commonly-found thin character of many of our locally-made wines. Theses insipid wines are usually the result of over-planting and poor vineyard management practices. I believe these wines are the direct result of incentives which encourage high yields of low-quality fruit.
I should note that not all grape growers are guilty of the offences I cite. Most growers are responsible farmers who are proud of their vines and work hard to produce the best fruit they can grow. These farmers have among-term contracts with wineries who expect high quality and who work with the growers to achieve outcomes that support quality winemaking.
A deal such as this one, which continues a practice started in 2010 is damaging, for the medium-term goal of strengthening Brand Ontario. If the effect is to continue to make wines that show little character or potential. We are trying to avoid surplus grape production by we are trying to eliminate the importation of foreign juice to make low-priced international blends and in the process, weakening further the quality of made-in Ontario-with-domestic grapes wines.
I wonder what readers in other winegrowing places think of Ontario after reading this trade item? This deal would suggest to the reader we are over-regulated, that we seek a new bottom in quality and simply want to isolate ourselves from the challenges of the global competition for market share in the quality wine segment.
This deal is nuts and is embarrassing for those of us who travel to international wine regions and those growers and makers who strive to showcase the best wines we can make in Ontario. The people from Ontario are the ones with the brown paper bags over their heads…
Where is the leadership in the Ontario wine industry? We are a small region and a region that faces so many regulatory and distribution challenges that we need to everything we can to help the industry build a brand for quality and gain greater acceptance among Ontario consumers.
I think it’s time for two things to be seriously considered by the provincial government. My first choice is de-regulate the grape wine market and open this market to full and free competition. Let growers and wineries negotiate prices with each other and let the market dictate how the price/quality equation will be balanced to the satisfaction of both parties. B.C did this several years ago and the result is a cooperative market where growers and makers are successful as partners. Oh, and by the way, these partners have raised the quality bar and both sides make adequate returns for their efforts and needs in the process.
If our government doesn’t have the nerve to pull the plug on this regulated regime then we should impose strict controls on planting. If indeed we have too much grape growing capacity in Ontario/Niagara then force marginal operations to pull their grapes and do not permit any new plantings without prior regulatory approval. This is the regime in Australia and maybe we need it here if we are going to truly commit to a move up the quality scale.
I hope someone can stand up to this bad deal and work to fix the underlying problems in Ontario before the next renewal in 2014.
Copyright© W. John Switzer 2003 – 2012.