Sub-sector Profiles: Index
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The Canadian Distillery Industry

The distillery products industry, North America Industrial Classification System (NAICS) 31214, comprises establishments that are primarily engaged in distilling liquor, except brandy, blending liquor; or blending and mixing liquor and other ingredients. However, this industry includes establishments primarily engaged in manufacturing ethyl alcohol whether or not the alcohol is used to make potable spirits. Products of NAICS 31214 include beverage spirits (except brandy), alcoholic eggnog, potable ethyl alcohol, alcoholic mixed drinks and whisky.¹

Introduction

The distilled spirits industry has a long history in Canada, and has traditionally made a significant contribution to the nation's economy. The first distillery of record was established in 1769 in Quebec City. By the 1840s, over 200 distilleries were in operation and Canada was earning a reputation as a producer of a distinctive high quality whisky, which still exists today.

The modern Canadian distilling industry produces a variety of spirits (e.g. whisky, rum, vodka, gin, liqueurs, brandy, spirit coolers and basic ethyl alcohol) but Canada's primary reputation, domestically and internationally, remains for the production of a distinctive rye-flavoured, high quality whisky. The product is distilled from cereal grains (rye and corn primarily), aged in oak barrels for a minimum of three years, then bottled or sold in bulk. Canadian Whisky captures one-quarter of the total Canadian spirits market and is the only Canadian distilled spirits product which is "appellation protected". This means that, by law, it can only be produced in Canada.

Until 1996, ethyl alcohol production in Canada had been primarily for beverage spirits, with a statistically insignificant proportion going toward industrial and fuel uses. This situation is changing and is briefly addressed further in this text. However, the major focus of this profile is the beverage alcohol industry.

Industry Structure

In 1999, 17 establishments² (principally beverage establishments), were in operation employing 1,869 people. Shipments of own manufacture were valued at $944.4 million.

Distilled products are also one of Canada's major manufactured food and beverage export commodities, representing $639.9 million in export³ sales in 2001, principally to the United States (US). Exports accounted for an estimated 70% of total shipments that same year.

The industry has long been dominated by multinational companies that are export-oriented, with select brands of Canadian Whisky having an international reputation for excellence. Industry production is highly concentrated. The latest available figures show 4 of the 13 firms controlling over 80% of shipments in 1996.

Since the merger of a large Canadian-based firm with European beverage interests in December 2000, this concentration of ownership is increasing and domestic spirits production in Canada is now essentially foreign-owned.

Multinational corporations maintain production facilities in Canada in order to produce "appellation protected" Canadian Whisky. The remaining 20% of shipments is generated by smaller companies with specialized product lines. Recent years have seen an increase in the number of smaller distilling companies that specialize in supplying niche market products.

The bulk of the beverage alcohol industry is located in Ontario (7 establishments) and Quebec (7 establishments), with remaining activity in Alberta (3 establishments), British Columbia (BC) (1 establishment), Nova Scotia (1 establishment) and Manitoba (1 establishment).

Distilled spirits shipments make up about 11% of all alcoholic and non-alcoholic beverage production in Canada and about 17.5% of all alcoholic beverage production. In terms of Canadian alcoholic beverage production, beer is the leading alcoholic beverage, followed by distilled spirits and then wine.

The value-added during production of branded spirits is high. In 1999, value-added was 62.3% of distillery shipments, compared to an average of 37.9% for the food and beverage industry overall.

In addition to potable ethanol (ethyl alcohol) for use as a beverage alcohol, ethanol is produced for industrial and fuel uses. Ethanol is used extensively as a solvent in the manufacture of varnishes and perfumes, as a preservative for biological specimens, in the preparation of essences and flavorings, in many medicines and drugs, as a disinfectant and in tinctures (i.e. tincture of iodine), and as a fuel and gasoline additive (i.e. gasohol). Fuel alcohol is ethanol denatured with 1% gasoline, which prevents its use as a beverage.

Canadian industrial alcohol production operations tend to be owned and operated by small- and medium-sized Canadian firms. There are currently three plants across Canada capable of producing up to 180 million litres of industrial alcohol per year - two in Ontario, and one in Quebec. Five plants have the capacity to produce up to 211 million litres of fuel alcohol: two in Ontario, one in Saskatchewan, one in Alberta, and one in Manitoba. Fuel ethanol imports from the US are estimated at 25 million litres per year.

Beverage firms are essentially marketers of branded products geared to fit consumer lifestyles, while commercial or industrial alcohols, like fuel ethanol, are considered to be a resource commodity. The sale of commodities tends to be more price-sensitive with competitive production costs being of more critical importance. Undenatured ethanol produced in an industrial alcohol plant could, however, be sold as a base alcohol to a beverage distiller.

Performance

We do not have a subject for "Performance", our apologies.

Economic Results

Domestic Market

For much of the past 15 years, the distilling industry has been in decline, as shown in the data on shipments (see statistical page at the end of this profile). The shrinking domestic market for spirits has been a contributor to the industry's overall lack of growth. Although per capita consumption of spirits by Canadians over the age of 15 has increased steadily since 1994, it has fallen significantly since 1981 when it was 10.21 litres. By 1999, Canadian per capita consumption fell to 6.53 litres. The trend to lower consumption is global, not just Canadian. A similar situation exists in the US and, to a lesser degree, in Europe.

Higher prices, due in large part to high taxes, coupled with lifestyle trends with preferences for beverages with lighter alcoholic content as a result of health consciousness and social concerns about drinking and driving, contributed to a 16.7% decrease in total domestic spirit sales between 1990 and 1999.

The domestic beverage industry is also experiencing increased pressure from imports for which Canadian consumers have been developing a taste. Imports³, which in 1992 were 35.1% of the domestic market, increased to 63.8% of the distilled beverage market by 1999 (from $181 million in 1992 to $421.7 million in 2001). The largest increases to imports have come from bourbon, fruit brandy, Irish Whisky and rum. Products such as grapa and limonjela have become important examples of specialty products.

The value of the Canadian market stood at $599.3 million in 1999, which represents a value increase of 16.1% between 1992 and 1999. Canadian Whisky leads spirits sales in all regions of Canada except Quebec, the Atlantic provinces, Yukon, and the Northwest Territories/Nunavut.

Recently, there have been indications that the decline in retail sales has halted. According to Spirits Canada (the Association of Canadian Distillers), domestic market retail sales registered modest gains during the 1997-2000 period. Sales in the large Ontario market grew 3.7% in 1998 and 3.2% in 1999. Vodka sales and spirit coolers have increased, indicating a shift in consumer taste preference. Spirits Canada has indicated that products like spirit coolers have become popular and demand for its traditional products are also showing signs of recovery.

The distilling industry has come through an extended period of restructuring. Through much of the 1990s, a number of establishments closed while others experienced excess capacity. As an indication of the industry's resizing, 22 establishments shipped $878 million worth of product in 1990 and employed 3,784 people. See Figure 1. By 1999, the number of establishments had decreased to 17 and employment had declined to 1,869 people. However, manufacturing shipments increased to $944.4 million, indicating a more efficient industry.

Figure 1: Imports³, Exports³ and Domestic Shipments, 1999

Distilled spirits represent a high value-added industry, a reflection of the considerable brand equity that consumers recognize in the industry's leading products. Value-added as a percentage of shipments decreased from 64.9% to 62.3% over the 1990/1999 period.

Employment

Employment in the distilled spirits industry has fallen 50.6% from 3,784 employees in 1990 to 1,869 people in 1999. See Figure 2. Productivity, as measured in terms of value-added output per worker, increased 56.6% from 1990 to 1999.

Figure 2: Total Shipments of Own Manufacture and Employment, 1990-1999

Figure 2: Total Shipments of Own Manufacture and Employment, 1990-1999

Investment

Statistics Canada data⁴ indicate that, while the average annual growth of investment capital construction in new buildings declined in the latter half of the 1990s, investment in machinery and equipment continued to average $15-20 million annually throughout the decade.

Industry investment strategy has focussed on resizing and repositioning to serve a changing market. During this time, firms have upgraded production technologies, partially in bottling processes, where glass has been replaced by polyethylene terepthalate (PET plastic) for some lines. There has been investment activity in new product line extensions, which have included new premium and super-premium products in some cases.

Investment attraction is not an issue for the beverage alcohol industry since most Canadian distillers are subsidiaries of multinationals that have access to significant investment resources.

The demand picture for fuel ethanol is reasonably good given the rising price of gasoline and crude oil from which gasoline is refined. Prospects for adding additional capacity in Ontario and Quebec, where two-thirds of the Canadian automobile fleet is located, is under consideration by existing industry participants.

Investment in the fuel and industrial-use alcohol industry currently stems from private Canadian sources. Several large US grain processing companies have significant investment in the US ethanol industry, as well as in the Canadian grain industry. However, no US companies have yet shown visible interest in investing in the Canadian fuel alcohol industry.

Trade Performance

We do not have a subject for "Trade Performance", our apologies.

Export Market

The export market has been the industry's largest single market. In 1992, the industry exported 59.8% of its production, compared to 70.7% by 1999. See Figure 3.

The value of exports³ was $499 million in 1992, rising to $639.9 million in 2001. To compare the distilling industry's export orientation with that of other beverage alcohol industries, exports as a percentage of shipments was 70.7% for distilleries in 1999, while they were 7.4% for wineries and only 7.1% for breweries.

Figure 3: Trade Performance³, 1992-2001

Canadian Whisky is currently exported to 150 different countries, but nearly 90% of total volume is destined for the US market. The US continues to be the industry's priority market where Canadian Whisky has an excellent quality reputation. Canada-US free trade and favourable Canadian-US exchange rates make the US an attractive market. Japan is the second major importer, accounting for 4.2% of Canadian export sales.

Sales to Japan have been hampered in recent years due to economic difficulties in the Japanese economy in the late 1990s. The United Kingdom is third, importing 1.6%. While sales to Western Europe remain relatively flat, brand companies have been turning their attention to emerging markets in Asia and Eastern Europe over the past six years, where progress has been made in improving the terms of access. Canadian Whisky represents approximately 80% of the total value of distilled product exports.

Bulk shipments to Japan and the US accounted for most of the increase in exports in the mid-to late 1990s. Bottled shipments decreased during that period, indicating a trend away from the sale of branded products. Increased bulk shipments (not branded) have been the result of sales to companies that bottle and market products under their own labels. For example, one of the best selling Canadian whiskies in the US was, in the past, shipped in bulk from Canada and then bottled and distributed in the US by the US brand owner.

While the decline in bottled shipments was partially due to lower consumption levels in the US, the US companies bottling bulk Canadian Whisky often sell it for a retail price significantly below the price of premium bottled brands imported from Canada. Canadian manufacturing firms are thereby in the position of supplying a bulk market that can undercut the market share of their own branded bottled products.

Spirits Canada (formerly the Association of Canadian Distillers) maintains there is evidence that the movement of bulk shipments is declining, particularly with premium products where there has been some new product development activity and where there has been a return to cased, bottled export sales in 1999-2000.

Significance

We do not have a subject on "Significance", our apologies.

Strenghts and Weaknesses

Structural Factors

Canadian distillery operations have traditionally had a solid worldwide reputation for quality, particularly Canadian Whisky. Despite industry rationalization, the domestic distilling industry is still considered large by world standards. Canadian beverage plants have sufficient size and access to competitively priced inputs, including corn, rye, distillers malts, and packaging, to enable them to be internationally competitive on production costs.

Distillers and commercial alcohol establishments have a ready access to adequate supplies of competitively-priced grain ingredients. The base alcohol for distilled spirits is derived primarily from corn. In Ontario, for example, distilleries purchased around 2.25 million bushels of corn in 1999. This base is then flavoured in different ways to create a variety of spirits products. For example, distilled rye is used as the main flavouring component of Canadian Whisky. The industry also buys small amounts of malted barley for whisky production.

Although beverage company profits may fluctuate somewhat with grain prices, these costs are not considered a major issue with regard to the industry's global competitiveness. Distilleries have the option of purchasing local grain if it is available at competitive prices, or through grain traders operating in the North American market.

The addition of new, large fuel ethanol production plants is eastern Canada is not expected to impact on the distilling industry's corn input in terms of price or volume because of this ability to access the large US market through grain traders. However, as a commodity, base alcohol (or ethanol) is extremely price sensitive and does not enjoy the equity that branded spirits possess. In addition, if destined for the fuel alcohol market, denatured ethanol must compete with gasoline, which is often less expensive to produce. Therefore, input costs of feedstock (fluctuating corn prices) are more of an issue when producing fuel ethanol or alcohol as a commodity.

If the beverage or industrial alcohol segments of the market were to expand significantly, competitively-priced grain in the form of corn is available in sufficient quantities. Currently, beverage alcohol production only uses approximately 1% of total corn production, while fuel and industrial alcohol uses account for approximately 2% of total production. Moreover, western grains also have some potential for fuel ethanol.

Corn production is primarily Ontario-based. Ontario has produced a surplus of grain corn since 1975 and the percentage of Ontario corn going toward alcohol production may increase significantly if new investments for commodity alcohol come on stream.

Brand recognition, international reputation and consumer loyalty are very important to the distilling industry. As a result, the ability to advertise is very important. Until recently, restrictions on advertising of alcoholic beverages (which have been lifted) made it difficult to introduce new products to increase market share and to compete against other beverages. Furthermore, distribution and product availability have been restricted because distilled spirits for home consumption are sold only through provincial liquor board outlets. However, in future Canada Post will be permitted to deliver alcoholic beverages to private residences.

Trade-Related Factors

The Canadian market is opening up more to pressure from imports as freer global trade occurs. Under the North American Free Trade Agreement (NAFTA), whisky and rum tariffs were immediately eliminated between the US and Canada, and other tariffs have now been phased out (January 1, 1998). Relevant excise levies on imports, equivalent to those applied to domestic products, remain in both countries. NAFTA is eliminating barriers, both tariff and non-tariff, which in the past have limited access to the Mexican market.

In 2001, Canada had a positive trade balance of $270.1 million in distilled beverage products. During the 1992 to 2001 period, where Canada's trade with all countries is concerned, imports have increased at a slightly faster rate than exports. The balance of trade ranged between $270-$350 million in Canada's favour during the last half of the 1990s. In the case of the US, the rate of growth of imports has also been stronger than exports, but the balance of trade remains heavily in Canada's favour.

The same is occurring in the case of Japan which, in the mid-1990s, lost a World Trade Organization (WTO) panel on discriminatory taxes that favoured domestic spirits. These developments provided an opportunity to increase Canadian exports into Japanese and Mexican markets.

The industry has traditionally concentrated on the US as its priority market, but there is recognition with trade liberalization that there are improving opportunities in both South America and Latin America, including Mexico. Such opportunities become of strategic importance to grow the Canadian distillery industry given the unrestricted access to the Canadian market other countries now enjoy.

To date, growth in exports to both markets has been slow. For example, the Asian flu has hampered export performance in southeast Asia, but the industry remains optimistic about Japanese sales.

Non-tariff barriers have a significant influence on world trade in distilled spirits. An important element is whether a spirit is recognized as a distinctive product in the legislation of the importing country. Such recognition protects the product from being blended with any other product, protects its prestige and enhances marketing efforts. Canada, for example, recognizes Scotch and Irish whiskies, bourbon, tequila, cognac and armagnac as distinctive products.

In Canada, distillers can import bulk spirits only for blending with domestic spirits. The Canadian industry does not bottle distinctive products such as Scotch or Irish Whisky, or cognac.

Although Canadian Whisky must be produced in Canada, it is not necessarily shipped from Canada directly to foreign markets around the world. Some companies ship to central warehouses abroad and then distribute product to other countries. This means it can be difficult to determine the ultimate destination of products shipped from Canada.

One reason for imports having captured close to one-half of the Canadian market is a consumer preference for variety, partially driven by a growing multicultural population. In addition, liquor boards are becoming much more market-oriented. Liquor boards increasingly monitor changing tastes in their respective domestic jurisdictions and as international purchasers, they stock what sells, regardless of origin.

As well, since the negotiation of the Canada-US Free Trade Agreement in 1987, Canada has granted US products national treatment (equivalent to treatment for domestic products) for listings, distribution and price mark-ups. A similar bilateral agreement on liquor board practices was reached with the European Community in 1988 and extended to all imported products on a multilateral basis under the General Agreement on Tariffs and Trade (GATT).

As a result, government policies and practices are required to treat domestic and imported products equally. It should be noted that prior to this, national treatment practices were already largely in effect for distilled products, compared to other alcoholic beverages such as wine. Further, Canadian subsidiaries of multinationals act as import distribution arms for their corporations' foreign brands. These firms distribute and market foreign products along with domestic products.

Regulatory Factors

Distilleries face extensive federal and provincial regulation. Much of the provincial regulatory framework stems from a federal statute, the Importation of Intoxicating Liquors Act. This federal legislation requires that all imported liquor into Canada enter through the resident liquor board within each province or territory (see list at the end of the document). The provincial and territorial governments are also responsible for the blending of alcoholic beverages, as well as regulating and controlling traffic in intoxicating liquor for sale and consumption within the province.

These liquor boards collect federal and provincial taxes on alcohol products and then add their own mark-up prior to sale of the product.

The federal excise tax system for alcoholic beverages presently in effect in Canada imposes taxes on spirits produced in Canada at the point of shipment to provincial liquor board warehouses. The federal excise tax on imported spirits is calculated from the point where spirits are imported and received into liquor board bonded warehouses, but does not become due until the product is shipped to the point of retail sale.

The Canada Customs and Revenue Agency, in conjunction with the Department of Finance, undertook a complete review of the Excise Act. The principal objectives of this exercise were to safeguard the tax revenue generated by alcohol and to provide a fair and modern tax structure that minimizes the impact of government policies on the industry. Streamlined procedures should offer cost benefits to distillers in complying with requirements. Draft legislation (Bill C-47) was introduced in the House of Commons on December 6, 2001 and the second reading for Bill C-47 took place on April 9, 2002.

The Canadian Food Inspection Agency (CFIA) and the provincial liquor boards work together to ensure that alcoholic beverages, including spirits, conform to Canadian safety standards under the Food and Drugs Act before being approved for sale in Canada (for alcohol content, toxins, etc.). In addition, both domestic and imported alcoholic beverages must comply with compositional labelling, net quantity and standardized container size requirements under the Food and Drugs, and Consumer Packaging and Labelling Acts.

On February 10, 2000, the Food and Drug Regulations were amended in order to modify the compositional standard for Canadian Whisky as a result of a cooperative effort between Spirits Canada and Health Canada. The amendment appeared in Part II of the Canada Gazette on March 1, 2000.

Specifically, Spirits Canada had requested that appropriate compositional standards for Canadian Whisky be published in Part I of the Canada Gazette providing, at a minimum, that Canadian Whisky is: a) distilled in Canada; b) aged for at least three years in Canada in wooden barrels; and c) contains 40% alcohol by volume.

These domestic changes will pave the way for establishing formal Geographical Indications for Canadian Whisky and will protect the product against inferior whiskies in the key global markets of our trading partners, such as the European Union, which has refused to recognize Canadian Whisky because the Canadian government did not recognize it in the past.

Technology Factors

The distilling industry in Canada, as in all countries, uses traditional, mature technology. The Canadian distilling industry is as technologically sophisticated as its major competitors. In general, Canadian distilleries have rationalized operations and upgraded production and distribution technologies which compare favourably with US operations, although some US distillers have larger economies of scale. The technological upgrading has been largely in bottling and packaging processes.

The industry has reduced the weight of its glass bottles as an environmental measure. Additionally, a current focus is experimentation with new package formats such as PET plastics in place of glass bottles for some lines.

With a mature market, new product development is of critical importance. There is considerable effort devoted to the creation of new products to diversify traditional product lines with new items that will stimulate consumer interest at home and abroad.

While the production of fuel and potable alcohol have some technical similarities, distillers are unlikely to convert closed potable alcohol plants which have made branded spirits into fuel ethanol plants due to their small size. A modern North American commercial or fuel ethanol plant can be an extremely large complex. A major beverage distillery has an annual production of approximately 32 million litres of alcohol per year, but a state-of-the-art fuel ethanol plant output capacity is 10 times greater.

As a result, a turnkey state-of-the-art fuel ethanol or industrial alcohol plant with North American competitive production costs, represents a significant investment.

ISSUES, CHALLENGES AND OPPORTUNITIES

Issues and Challenges

Even though distillers realize they face a mature market for their products, the high degree of regulation makes it difficult for distillers to directly intervene in the marketplace to implement marketing practices or pricing schemes of their own that might generate consumer interest in their products.

Liquor boards, rather than the distillers, largely determine the marketing practices and price-setting policies and, ultimately, the profitability of the industry. Distribution and sales procedures are determined by the responsible provincial agency and are, in most instances, primarily through agency-controlled outlets. (Alberta is an exception with privatization of alcoholic beverage sales outlets.) Pricing structures are generally put in place by the liquor boards and these reflect federal and provincial taxation. As well, provincial governments apply varying mark-up percentages to products.

The level of taxation by both provincial and federal governments and provincial mark-ups are key issues for the industry. The industry has argued that increased taxes have been a major factor in the consumption decline, which has triggered the general industry decline and has subsequently hurt the profitability of the Canadian spirits sector.

Smuggling has also been an industry concern. There is no consensus on the size of the alcohol contraband market. Generally, a lower consumer price for spirits in the US makes smuggling a profitable activity. Approximately 80% of smuggled product is thought to enter via Ontario and Quebec, but BC is also rising in importance, particularly given Vancouver's close proximity to the US border.

Another challenge facing the industry was a long-term ban on the advertising of spirits on television by the Canadian Radio and Television Commission. The industry launched a court case in 1995 to challenge this ban and won the right to advertise. Since that time, Spirits Canada has advertised regarding the equivalency of alcoholic beverages and, more recently, private firms have begun to initiate some advertising. Similarly, a ban on advertising campaigns for branded beverage products in the US has also been removed.

Like all food processors, distillers are assessing how to deal with the emergence of E-commerce. The distilling industry will have to determine if it can effectively use this medium to increase efficiencies through business-to-business solutions.

Distillers are aware of the public's perception of biotechnology and genetically modified organisms (GMOs). There is concern that the industry could be affected if their products are negatively associated with these issues.

Opportunities

The development of a global economy has not affected the distilling industry in the same way that it has affected other segments of the food and beverage processing industry. This is largely because the industry is dominated by large multinationals which, for some time, have had a globally competitive perspective and maintained marketing/sales/distribution offices and manufacturing facilities for alcoholic beverages in most of the world's major countries. These facilities are either owned by a multinational firm, or operate as joint ventures with companies that were already established in that market.

A key to the continuing competitiveness of the Canadian industry in a global economy is the "appellation protected" status of Canadian Whisky and the industry's adherence to quality. The US and Canada have granted reciprocal recognition of bourbon and Canadian Whisky as distinctive products. This offers protection from competition and from adulterated or misrepresented products.

The whisky standard ensures that as long as there is a market for Canadian Whisky, it will be manufactured in Canada. However, achieving a "distinctive" status for Canadian Whisky worldwide would further protect this manufacturing base as it would also increase the prestige of the product internationally.

Product development and marketing are a strong focus for brand companies in the development of new markets. These operations are often controlled by multinational parent companies, as opposed to manufacturing establishments, and are not necessarily based in Canada. Branch companies rely heavily on consumer research and intelligence from distribution firms in individual markets when developing new product lines and targeting marketing campaigns to specific consumer groups within a particular country.

Further, although Canadian companies currently manufacture many types of distilled products, it should be noted that multinationals will shift manufacturing mandates between different production facilities (on an international basis, but particularly within North America) on products other than Canadian Whisky as efficiencies demand.

Domestically and throughout North America, the distilling industry has targeted strong marketing efforts at revising interest in spirits beverages and attracting new generations of consumers. Part of this strategy has been the development of new products such as flavoured spirits and low alcohol content spirits beverages such as "coolers". In addition, the industry has been working on upscale line extensions (premium products) in their traditional products, many of which have been designed for export markets.

Also, younger alcoholic beverage consumers are developing a more mature taste profile which typically includes spirits, as well as wine and beer. Further, there has been a noticeable trend back to "cocktail" consumption, especially with the introduction of new "Martini" cocktail bars. As well, dark goods such as whisky, brandy and cognac are beginning to enjoy a resurgence of interest.

The Canadian industry advocates education on equivalency and the responsible use of spirits. All these efforts are having the effect of bolstering spirit sales in what has previously been a declining alcoholic beverages market.

Canadian distillers' focus on the marketing and distribution of global brands and strong export orientation are key factors in maintaining the industry's competitive position internationally. The lifestyle trends away from the consumption of spirits in some markets has impinged on the profits of many distilling companies, not just those in Canada. However, the large multinationals which dominate the Canadian industry have significant resources to develop and market new brands, alter production capacities, shift product mandates to different geographical locations and attract investment as efficiencies demand. The industry forecast into the next few years is "cautiously optimistic".

In the past, advocates of fuel ethanol have been successful in promoting the environmental advantages of blending ethanol with gasoline as ethanol-blended gasolines have lower carbon dioxide emissions.

For corn producers, the added prospect of solving air quality issues and generating a new source of demand for corn or other grain feedstocks remains attractive.

Investment in commercial alcohol for industrial alcohol is likely to continue to come from players who are not associated with drinkable brand alcohol products. Fuel alcohol demand could be driven by future environmental considerations associated with clean air, but it will also remain sensitive to future developments in energy markets and, ultimately, to rival technologies which may, in the longer term, at least partially replace the gasoline combustible engine.

¹ Statistics Canada has reorganized its definition of industry sectors. As a result, the Standard Industrial Classification (SIC) 1121 definition for distilled spirits has been converted to NAICS 31214 for all statistical data.

² Establishments included in the NAICS 31214 have sales greater than $30,000 in volume of ethyl alcohol sold, where the establishment must be a manufacturer and the largest portion of value-added must be in manufacturing

³ Distilled spirits exports and imports comprise undenatured ethyl alcohol, denatured ethyl alcohol, bottled and bulk rye, bottled and bulk whiskies, rum and tafia, gin and geneva, vodka, liqueurs and cordials.

Table : SCIAN 31214 distilleries, 1990-2001 (Stats available in HTML only)

Associations

Spirits Canada
(Association of Canadian Distillers)
Head Office
Suite 518, 90 Sparks Street
Ottawa, Ontario K1P 5B4
Tel: (613) 238-8444
Fax: (613) 238-3411
Email: info@acd.ca
Internet Site: www.canadiandistillers.com

Provincial Liquor Boards

Yukon Liquor Corporation
9031 Quartz Road
Whitehorse, Yukon Y1A 4P9
Tel: (867) 667-5245
Internet site: www.ylc.yk.ca

Northwest Territories Liquor Commission
Suite 201, 31 Capital Drive
Hay River, NWT X0E 1G2
Tel: (867) 874-2100

British Columbia Liquor Distribution Branch
Ministry of Small Business, Tourism and Culture
2625 Rupert Street
Vancouver, British Columbia V5M 3T5
Tel: (604) 252-3000
Fax: (604) 252-3464
Internet Site: www.bcliquorstores.com

Alberta Gaming and Liquor Commission
50 Corriveau Avenue
St. Albert, Alberta T8N 3T5
Tel: (780) 447-8600
Fax: (780) 447-8914
Internet site: www.aglc.gov.ab.ca

Saskatchewan Liquor and Gaming Authority
2500 Victoria Avenue
P.O. Box 5054
Regina, Saskatchewan S4P 3M3
Tel: (306) 787-1737
Internet site: www.gov.sk.ca/govt/lga/

Manitoba Liquor Control Commission
1555 Buffalo Place
Winnipeg, Manitoba R3C 2X1
Tel: (204) 474-5514
Email: info@mlcc.mb.ca
Internet site: www.mlcc.mb.ca

Liquor Control Board of Ontario (LCBO)
General Inquiries
55 Lake Shore Boulevard East
Toronto, Ontario M5E 1A4
Tel: (416) 365-5900
Email: infoline@lcbo.com
Internet site: www.lcbo.com/index.html

Société des alcools du Québec (SAQ)
905, avenue De Lorimier
Montréal, Québec H2K 3V9
Tel: (514) 459-3536
Email: info@saq.com
Internet site: www.saq.com

New Brunswick Liquor Corporation (NBLC)
P.O. Box 20787
Fredericton, New Brunswick E3B 5B8
Tel: (506) 452-6510
Internet Site: www.nbliquor.com

Nova Scotia Liquor Corporation (NSLC)
P.O. Box 8720, Station A
Halifax, Nova Scotia B3K 5M4
Tel: (902) 450-5802
Internet Site: www.nsliquor.ns.ca

PEI Liquor Control Commission
3 Garfield Street
P.O. Box 967
Charlottetown, PEI C1A 7M4
Tel: (902) 368-5720
Internet Site: www.peilcc.ca

Newfoundland Liquor Corporation
P.O. Box 8750, Station A
90 Kenmount Road
St. John`s, Newfoundland A1B 3R1
Tel: (709) 724-1100
Email: nlc@nfld.com
Internet site: www.nlc.nfld.com

Agriculture and Agri-Food Canada Contacts

Gayle Smith
Food Bureau
Market and Industry Services Branch
930 Carling Avenue
Ottawa, Ontario K1A 0C5
Tel: (613) 759-7536
Fax: (613) 759-7480
Email: smithg@agr.gc.ca

Monica Treidlinger (co-author)
Food Bureau
Market and Industry Services Branch

Date Modified: 2004-06-02		Important Notices
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