How it Works: Importing Wine into Canada

About a week ago, as I was first thinking about this blog post, a headline popped up on my Google News search that grabbed my attention: “No wine panic over Port of Montreal lockout – yet," from the Montreal Gazette.

I love to try different wines, and my tastes aren’t limited to North America. Neither are those, I would wager, of many consumers —the Liquor Control Board of Ontario (LCBO), for example, stocks products from a whopping 77 different countries, according to their website (although this figure isn’t limited to wine).

That said, I had only the vaguest of ideas about how my favourite Italian red makes its way from the winery to the liquor store shelves, and the Port of Montreal story made me curious. So I asked.

Rick Perkins, from the Nova Scotia Liquor Corporation (NSLC), directed me to the NSLC’s 2004-2005 annual report, which outlines how a shipment of wines makes its way from Adelaide, the capital city of South Australia — and the furthest point on the NSLC supply chain, barring the emergence of a Martian wine industry — to Halifax. Wally Dicks, VP Supply Chain for the Newfoundland Labrador Liquor Corporation (NLC), took some time to talk me through the finer points of bringing in wines from overseas.

I’m sure the exact process varies from province to province (and doesn’t apply to Alberta), but this is what I learned.

Throughout the year, the liquor board’s product supply department reviews the supplier countries for NLC listed products and based on sales, forecasts which products need to be ordered. They then submit orders to the appropriate wineries in that country. It takes a winery up to a month to prepare an order, at which point an international freight forwarder contracted by the NLC picks up the order from the winery and transports it to their warehouse, where it joins NLC orders from other wineries.

Once the warehouse has assembled enough orders to fill a shipping container, they book the container onto a boat bound for Halifax. The four Atlantic liquor boards have an agreement that allows them to consolidate their shipments, meaning that they can assemble the container-load (roughly 13,000 bottles) required for shipping more frequently than if each was acting alone. Keep in mind that the ordering-receiving process can take up to a couple of months for the NLC, which is why, Dicks says, you don’t want to wait until stores are running low on a product before placing your order.

The basic task of transporting a shipping container from Adelaide, Australia to Halifax takes more than a month: 32 days from Adelaide to Philadelphia, a stopover in the City of Brotherly Love to offload the container to a smaller vessel, and then another three or four days up the coast to Halifax.

Let’s pause here for a second. While the consolidation system works well for importing product from regions that produce a large number of popular wines, such as Italy or California, Steve McConnell, manager of marketing for the Manitoba Liquor Control Commission (MLCC) points out that problems arise in trying to stock wines from smaller regions.

For an example, he points to Oregon. There is no consolidation point in the state, and the MLCC doesn’t order enough from Oregon wineries to make up a full container-load. The cost of shipping just a few cases of pinot noir from several wineries to Manitoba would be prohibitively high, so the MLCC has several work-arounds.

One option is to ask the winery if their wines can be ordered and shipped through the California consolidation point. Another is to order stock through private warehouses in Alberta and British Columbia, which may bring in such specialized containers and then supply all of Canada from those. Yet another similar option is to order a product from another provincial liquor board, a method particularly useful in bringing highly-coveted products — Penfolds Grange, for example, for which stock is allocated to certain buyers by the supplier — to a smaller market like Manitoba.

Back in Halifax, a third-party company takes the container to a warehouse and “de-stuffs” it, sorting the contents by destination province. Once a full container-load of NLC product has been assembled, Oceanex (a company that specializes in shipping to Newfoundland) takes over.

Once the container arrives in Newfoundland, the wines must be cleared by Canada Border Services before they are transported to the NLC’s main distribution centre. From there, cases are distributed across the province according to store managers’ orders, or, for special listings, divided up among those NLC retailers that specialize in wine. Once they arrive at the stores, most product goes directly onto the shelf, ready to be purchased and enjoyed by consumers.

That novella is the Coles’ Notes version of the wine supply chain. It’s worth pointing out that when I called McConnell to ask about this, he advised me that I could write a book on the subject if I really wanted to (this blog post, I think, will suffice for now).

And, in the time it took me to put this post together, they’re back to work at the Port of Montreal. Wine lovers can breathe a sigh of relief.

Cheers!

Photo: Stephen Downes