The spirit industry is bracing for a potential showdown as Ontario Premier Doug Ford’s decision to remove Crown Royal whisky from LCBO shelves has ignited a furious debate and raised concerns about an escalating interprovincial trade war. Ford’s move, ostensibly a response to Diageo’s closure of its Amherstburg, Ontario, bottling plant, is already facing strong opposition from Manitoba Conservative MP James Bezan.
Ford’s rationale – a desire to reduce reliance on foreign-produced whisky – seems a calculated attempt to pressure Diageo. However, the move quickly drew criticism, particularly from Bezan, who characterized it as ‘misinformed’ and warned of potential repercussions for Ontario’s wine market. The crux of the matter is that Crown Royal whisky is now distilled primarily at Diageo’s Gimli, Manitoba, facility.
Diageo’s response has been swift. While the Amherstburg plant is closing, production will continue at Gimli and Quebec. This strategic shift is crucial, as Manitoba’s liquor sales of VQA Ontario wine have steadily increased over the past three years, reaching between $2.6 million and $3.2 million annually. The Rural Municipality of Gimli has voiced its confidence in Diageo’s continued operations within the country.
Industry observers are highlighting the potential domino effect. A trade dispute could trigger further protectionist measures, impacting not only Ontario wine but potentially broader spirits distribution across the provinces. The implications extend beyond simply one brand; it’s a question of precedent and could reshape the entire Canadian liquor landscape.
The Players:
*
Doug Ford:
Ontario Premier who is pushing forward with his plan to remove Crown Royal from LCBO shelves.
*
James Bezan:
Manitoba Conservative MP who has expressed concerns about Ford’s plan and threatened a potential retaliatory move targeting Ontario wine.
*
Diageo:
UK-based company that owns Crown Royal and announced the closure of its Amherstburg, Ontario, bottling plant.
The Facts:
* Crown Royal is distilled at Diageo’s Gimli, Manitoba, facility.
* Production will continue at the Gimli facility following the closure of the Amherstburg plant.
* Manitoba’s liquor sales of VQA Ontario wine have ranged between $2.6 million and $3.2 million annually over the past three years.
* The Rural Municipality of Gimli has expressed confidence in Diageo’s commitment to its operations in the country.
What This Means for Consumers:
Initially, consumers in Ontario will see Crown Royal whisky unavailable through the LCBO. However, the brand remains accessible through private liquor stores and direct-to-consumer channels. The potential for a trade battle will inevitably lead to increased prices and potential shortages, regardless of the final outcome of the negotiations.
Pros and Cons:
*
For Ford:
A potential boost to Ontario-produced spirits and a reduction in reliance on foreign imports.
*
Against Ford:
Risks of escalating trade tensions, negative impacts on consumer choice, and potential damage to Ontario’s reputation as a desirable tourism destination.
*
For Diageo:
Maintaining a key production location and access to a significant market.
