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VQA wineries have growing impact on Ontario economy

Posted February 06, 2012

VQA wineries have growing impact on Ontario economy

Printed in the St. Catharines Standard on February 6, 2012
By Don Fraser, Standard Staff

Ed Madronich's operation is a testament to the vine-like extent of the VQA wine industry's impact on jobs.

At his Flat Rock Cellars Winery in Jordan - which makes wine from 100% Ontario-grown grapes - the tentacles of employment are everywhere.

To start, he creates agricultural jobs for people working in the vineyards.

After the grapes are picked, manufacturing-type jobs come into play as the product is fermented and bottled.

"And these are well-paying manufacturing jobs," said Madronich, the winery's president. "There's the wine-maker, assistant wine maker, harvest hand, cellar hand."

Then Flat Rock sells its cases. This generates more decent, stable positions in marketing and sales. Its tourism-based retail store employs yet more people. And building his winery structure and adding to it has created work in construction.

Each year, Madronich employs seven people full-time, then perhaps another 25 part-time staff, plus vineyard workers.

Flat Rock Cellars is also only a modest operation. Many of the 100-plus VQA wineries in the province are bigger job creators.

"Ontario's VQA is a an unbelievable story," said Madronich, who is also chair of the Wine Council of Ontario. "We actually capture all of the industry sectors within each and every one of our wineries.

"We're very Canadian about things, and don't toot our own horn sometimes. We should."

A new KPMG report for the Wine Council of Ontario highlights how much of an economic driver the provincial VQA sector has become.

It indicates 1,300 additional jobs were created by the VQA wine sector from 2007 to 2010. In all, it says the economic impact of each litre of VQA wine sold on the Ontario economy rose to $12.29, nearly a 20% increase since 2007. And that value doesn't include taxes collected.

Sales of VQA wines in Ontario also climbed to $269 million, from $178 million in 2007 - a 51% increase.

Overall, the industry generated $191 million in the Ontario economy in 2010.

Meanwhile, Ontario VQA exports to other countries are surging, said the study. Wine tourism in Ontario is also expected to grow by at least 20% over the next five years.

In Madronich's view, while intelligent marketing is a factor the core reason for the growth is in the bottle.

"We're just making good wine," he said. "This land, this soil, this climate is great for making great wine. And at great value, great price and competitive internationally."

VQA Ontario executive director Laurie Macdonald also credited the impressive growth figures cited in the report to wineries who've worked hard to produce the best product possible.

"The quality is certainly continuing to increase," Macdonald said. "We're very proud of the system, and the wineries are doing a very good job."

The report is a "great story about our agriculture and investing in domestic product," said Paul Speck, president of Henry of Pelham Family Estate Winery in St. Catharines.

However, Speck - a past chair of the wine council and member of the Ontario VQA board - said the VQA situation isn't all rosy.

"There are huge challenges in global competition," he said. "There are huge subsidies for the industry in other countries."

He said European Union-member subsidies, which help make imported bottles cheaper here, are "off the chart."

"We're nowhere near that, and we're in a high-cost production area," Speck said.

"When you see bottles of wine coming from these countries under $10 a bottle, it's shocking. So we have to be super-efficient and really good at what we do."

dfraser@stcatharinesstandard.ca

Factbox

KPMG's report on Ontario's VQA wine industry

- sales of the wines in Ontario rose to $269 million in 2011 from $178 million in 2007, a 51% increase

- 1,300 additional jobs were created by the VQA wine sector from 2007 to 2011

- the economic impact of each litre of VQA wine sold (not including taxes generated) is $12.29, a nearly 20% increase since 2007

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