Ontario wine agents are accusing the Liquor Control Board of Ontario of “unfair policies” after California wines were pulled from LCBO shelves almost a month ago due to the ongoing trade dispute with the U.S., while grocery stores and retail giants like Costco and Loblaws are still allowed to sell the products.
Agents say they are also frustrated by the LCBO’s lack of communication about existing inventory and shipments still in transit from orders placed before the ban.
On March 4, Ontario Premier Doug Ford announced that the LCBO would pull 3,600 U.S.-made alcohol products from its shelves in response to U.S. tariffs, urging consumers to support Canadian brands instead. Other provinces have also followed suit as part of a broader national response to the U.S. tariffs imposed on Canadian goods.
While the LCBO says it has stopped selling American wines to grocery and convenience stores, “the decision to sell through existing inventory is at their discretion,” it said in an emailed statement.
The LCBO calls “agents” people or companies who are officially approved to work with it under its Consignment Program. These agents order alcohol from specific suppliers (like foreign wineries or distilleries) through the LCBO. They pay to store the products in LCBO warehouses and help organize sales, usually selling to bars and restaurants.
Since the ban was instituted, agents aren’t able to access any U.S. products from the LCBO.
“But Costco still has hundreds of cases of California wine on their shelves because they (unlike myself) are allowed to warehouse their wines,” said Mark McFadyen, director of Abcon International Wine Merchants Inc, a Toronto-based importer of Californian wine, in an email to CBC News.
Costco did not respond to CBC News’s request for information about their arrangement with the LCBO. But the LCBO said, “licensed retailers are responsible for storing all products purchased.”
Concerns with warehouse access and inventory
McFadyen sells wines directly to restaurants and through LCBO’s Vintages section. He says he had a “major release” of a California merlot in the LCBO’s Vintages section, which means a special, limited-time offering of wine from California that isn’t usually available on regular shelves.
Now, he can’t sell California wines to restaurants or even retrieve them from the warehouse.
The LCBO manages the storage and warehousing of alcoholic products it sells, until distributed to LCBO stores or authorized retailers across Ontario. The agents normally pay for the storage. Agents were informed that they will no longer have to cover storage costs for U.S. products at LCBO warehouses starting March 4 due to the ban. However, agents argue that storage is only one of many ongoing concerns.
“We don’t know how they’ll handle storage fees moving forward. For example, if my wine was in storage for 20 days before the ban, will the count continue from Day 21 on April 3? Or will it reset?” said Laura Rapuano, director of Airen Imports, another Toronto-based American wine importer. About 60 per cent of her income comes from Californian wines.
During the June-October quarter of 2024, the LCBO sold $2.24 billion in wine — which accounted for about 28 per cent of its sales that quarter. American wines made up 20 per cent of the province’s wine market share.
In addition to storage issues, Rapuano is also concerned about inventory limits.
Ontario is pulling 3,600 U.S. products off LCBO shelves in response to Trump’s tariffs, with Premier Doug Ford encouraging people to buy Canadian brands instead.
Agents are restricted in how much stock they can have on hand and in transit. Although the LCBO said “inventory caps are not affected by the amount of U.S. products in storage,” Rapuano is worried that if new stock from other countries arrives — something she is working on — she risks exceeding the limit and being unable to order more products if and when the ban is over.
Impact on restaurants
The effect of the LCBO’s decision is being felt by restaurants across Ontario. Many owners have told agents they won’t be putting California wines back on their menus, even if the ban on U.S. booze is eventually resolved.
Many restaurants are in favour of the ban, according to Tony Elenis, president and CEO of the Ontario Restaurant Hotel & Motel Association.
“Overall, Ontario restaurants have supported the government’s decision to remove U.S. beverage alcohol products from LCBO listings,” Elenis said.
It will soon be easier for Canadians to buy alcohol from other parts of the country, thanks to a deal between the provinces and federal government that’s part of a host of changes to encourage internal trade in the face of U.S. tariffs.
He added that some restaurants may still offer California wines, while they have stock, but many are instead highlighting Canadian wines from Ontario and British Columbia.
Some restaurants are turning to alternatives from regions like Australia, New Zealand and France.
However, Rapuano says importing a new wine isn’t an overnight process. It involves finding a supplier, sampling the wines, completing the paperwork, getting a purchase order, and shipping. “It takes six to eight months. I can’t just switch my business model in a month,” she said.
In the meantime, Rapuano says she has yet to receive a response from the LCBO regarding the emails she sent about her concerns. “I also emailed Premier Doug Ford, pointing out that grocery stores can still sell Florida orange juice, but I can’t sell California wine,” she said.
