Look down the barrel: Wineries face supply shortage, cost increases

From coast to coast, Canada has several regions known for their locally grown wine.

But this year, wineries are facing an extremely difficult supply shortage for one of the most important items to their business – the bottles.

Maverick Estate Winery in the Okanagan Valley of British Columbia is seen. (Courtesy: Maverick Estate Winery)

Maverick Estate Winery overlooks the hills of the Okanagan Valley in British Columbia.

Jan Nelson bought the 10-year-old winery in April 2020 and since then he has faced constant challenges in relaunching the business.

From COVID-19-related lockdowns to the thermal dome and wildfires western Canada experienced over the summer, Nelson now faces significant delays in ordering basic supplies for his cellar.

“We normally bottle from late winter to early spring and usually place this order in November. This year we ordered all of our bottles in July and we are still not sure if they will even arrive by March 2022, ”said Nelson.

It’s not just shipping delays that wineries need to consider, but sky-high bottle costs as well.

“The prices have really gone up, we are seeing double the cost of a bottle compared to about a year ago,” said Jim Reschke, vice president of Konzelmann Estate Winery.

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The exterior of the Konzelmann Estate winery is seen. (Courtesy: Konzelmann Estate Winery)

With the additional money that accumulates, the family winery will have no other choice but to pass some of these costs on to the consumer.

“We’re probably not going to be able to eat all of these costs. We’re probably looking at taking about 50 percent of that cost and adding it to a bottle of wine, ”said the owner of the Niagara business.

But the supply chain puzzle doesn’t end there for Canadian wineries.

There are a variety of issues affecting the cost of shipping goods to North America.

From stranded shipping ports to lack of workers, wineries also have to fork out thousands of extra dollars just to pay for the container to source overseas.

“Normally it costs an additional $ 6,000 to ship from China to Vancouver if you pay for the entire container,” Nelson said.

“Now we’ve seen estimates for an extra $ 10,000 to get a container, but we’ve heard that other wineries are quoted up to $ 30,000 based on shipping weight and others. factors “

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Bottles of wine from Maverick Estate Winery are seen. (Courtesy: Maverick Estate Winery)

There is little that wineries can do to avoid these higher prices during the pandemic.

But some wineries decided to order as much as they could without maximizing their line of credit in order to get the best bang for the buck.

“To try to accommodate that, we buy as much as we can afford at one time because we don’t know when we can get the next shipment these days and it’s so expensive every time we have to. place an order, ”Nelson said. .

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About Bob C. Zoller

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