BC wineries have green light to use imported grapes in 2024

Photo: SpearHead's Grant Stanley (photo courtesy of SpearHead Winery)

Grant Stanley, the general manager of SpearHead Winery in East Kelowna, was in Oregon last week. He was finalizing the purchase of twenty tons of Pinot Noir from Cherry Hill Winery, a boutique producer in the Willamette Valley. “I am looking forward to making Oregon Pinot Noir once again!” Grant told me, referring to working the 2001 vintage in Oregon before joining Quails’ Gate Estate Winery in 2003. “You know I am a Pinot guy,” Grant once told me “I don’t advertise it but with all the different varieties I make, I still spend about 80 percent of my time thinking about Pinot Noir.” He has been at SpearHead since 2018, making such exquisite award-winning Pinot Noirs that SpearHead won the “Winery of the Year” designation at the recent Wine Align National Wine Awards. In this vintage, he is buying Oregon (and Washington State) grapes for the same reason that most other Okanagan and Similkameen wineries are doing the same: because of last January’s devastating week-long cold snap, the vineyards in the two valleys will produce almost no grapes this fall.

The crisis of almost zero wine production this fall was averted last week then the BC government announced major regulatory changes enabling wineries to buy grapes (or juice) from outside the province. The changes include a temporary exemption of the requirement that land-based wineries source at least 25% of their grapes from owned or leased land for wines sold to or through the Liquor Distribution Branch. The government also has granted a temporary waiver to the requirement that wineries must produce a minimum of 4,500 litres of wine a year to retain their licenses. Most critically, the government has agreed that wine made from imported grapes in 2024 will be exempt from the 89% markup that applies to wines made with bulk wine imports. In short, the 2024 wines vinified from imported grapes will be treated like VQA wines. The regulatory changes – some details still need to be worked out – are in effect for one year, beginning April 1, 2025, when these wines will begin entering the market.

“This is a very good stopgap measure for this vintage, to enable us to remain profitable and viable,” says Mark Sheridan, the president of Hester Creek Estate Winery. “When our vineyards bounce back, our local growers will have wineries that are still afloat and can purchase their grapes. But I want to be clear that we are committed 100% to our local growers and to BC grapes long term.” By a stroke of good fortune for BC wineries, there is a massive grape surplus in Washington State because Ste. Michelle Wine Estates, formerly the state’s largest winery, sharply reduced its grape purchases, beginning in 2023. It is estimated there are 10,000 surplus acres of vineyard in the state – about the same as the total vineyard acreage in British Columbia.

It appears many BC producers, gambling that the regulations would be changed, began exploring Washington and Oregon grape sources as long ago as March when the extensive crop losses were becoming evident north of the border. “I was down there in February and lined up our grower in the Horse Heaven Hills after having meetings with a number of suppliers,” says Evan Saunders, the winemaker at Blasted Church Vineyards. “We had everything in place in the week before the Vancouver International Wine Festival [at the end of February]. I have been down to visit with them five or six times since then and will be down again in a couple of weeks for another vineyard tour. I think we have found exactly what we need variety, quality, and partner-wise.”

Photo: Tony Holler of Poplar Grove

He put Poplar Grove Winery in touch with Washington growers. Poplar Grove president Tony Holler moved quickly to tie down fruit sources. “We started this process of looking at importing grapes in February and signed contracts at the end of March,” he said last week. “We have secured a supply; and we are also working with a lot of small wineries. It is difficult for them, as a small winery, to bring grape juice up in small quantities because it is so expensive and so onerous. We have said to our neighbours and to wineries we know: tell us what you need and let us figure it out. We have a group of us involved in this whole process.” Tony describes the Washington State growers as “a fantastic group of people. They have all of the infrastructure to help us. They are being very helpful. Our winemaker [Stefan Arneson] is going down for about a month. He will go just before harvest and stay until the last grapes are harvested. The growers have said they will do what we tell them to do.”

Hester Creek’s Mark Sheridan, an Australian-trained viticulturist (pictured) has been dealing with a grower in Washington’s prized Red Mountain viticultural area since early spring. “We had a contract in place and they were holding the grapes for us. I have been down their multiple times and have had input into how they grow the grapes. We have our own section of their vineyard that they have allocated to us. I have full input as to how they are growing the grapes on that section. All the viticultural inputs are being directed by myself.” He plans to bring in about 850 tons of grapes, all of which will be processed at Hester Creek by its winemaking team. “The reason we chose Washington State is because, for the wine we want to make from these grapes stylistically, that was the closest fit to the style of grapes we would grow here,” Mark says. “We will have a series of wines that we make from Washington State grapes,” Mark continues. “We will be clearly labelling them as Columbia Valley. We polled a lot of our customers, and our customers have clearly told us they have faith in the Hester Creek brand; and they will support that brand, even if it is from Washington State, because they know the reason why we are doing this. We need to have wine to sell so that we can be economically viable.”

That is the overall purpose of enabling land-based BC wineries to do a vintage with imported grapes when the BC vineyards have negligible production this year. Winegrowing has become a major industry in the province, generating $3.75 billion in annual sales, employing 14,000-fulltime workers and attracting about a million tourists a year. Even a one-vintage failure would have a severe economic impact.

“I have heard directly about the impacts we are facing if we leave this sector unsupported at this point,” Roly Russell, the parliamentary secretary for Rural Development, said at last week’s announcement of the changes. “Wineries are facing significant financial difficulties, which is expected to lead to multiple closures and bankruptcies, and potentially hundreds of layoffs of BC workers. There would be cascading economic impacts in these communities, especially around tourism and hospitality. These losses would have significant and lasting impacts in the BC wine industry and on so many other businesses across the Okanagan and the Similkameen regions.”