November 7, 2009

What's this I keep hearing about Cellared in Canada Wine?

For some time (since 1973 in fact), Ontario wineries have been allowed to import juice or wine from other countries and then bottle it as their own. Bottles containing mostly foreign wine were originally labeled Product of Canada. Then in 1993 Product of Canada was replaced by Cellared in Canada (CIC). So, what you've been reading and hearing about lately is that people don't get it, and that in an effort to support the local wine industry, they've been buying CIC wines and unknowingly underwriting wine factories in California, Chile and elsewhere.

Why Did This Come About
In the beginning, Niagara had thousands of hectares of north American Labrusca grapes the likes of Concord and Niagara and even one called President (“President Champagne” anyone?) When better grapes came along, the Ontario government encouraged growers to grub up their Labrusca vines and replant with French-American hybrids, mostly Vidal, Seyval Blanc, Marechal Foch, and Baco Noir. Then in 1989 the government launched another grubbing up program when some die-hard wineries started planting European Vinifera grapes: Chardonnay, the Cabernets, and especially Riesling. (It's interesting to note that government experts insisted for decades that Vinifera vines could never succeed in Ontario.)

So, what do you do when you've ripped out your vineyard and now must wait 3-5 years to harvest grapes? The simplest solution is to allow wineries to import even more wine with which to “extend” their remaining harvest. Now, the original plan was to phase out the imported wine, with a “sunset” in the year 2000. But by then a few large wineries had shifted their business plan from Canadian fine wine to cheap and cheerful jug wines (but without the jug, at least). It's pretty hard to change a law that has allowed a few companies to grow rich and dominate the market, so the plan was carved in stone ... soapstone, as it turns out.
In 1993, when Canada signed the Free Trade Agreement, Ontario put a cap on the entire wine business. Only wineries establish before NAFTA would be allowed to import wine for blending. Moreover, only these wineries could own multiple site licenses. So we now have a two-tiered system: wineries that can do pretty much what they want, and those that can do little more than pay the bills.

Setting the Standard
VQA (see below) goes back to 1989, when a number of Ontario’s better winemakers decided that an “appellation” system would help give Ontario wines credibility in the world marketplace. Most Old World wine-producing countries have a system of controls that determine which wines meet their standards, including how to communicate that standard to the buyer. In France, for example, Grand Cru is one such a standard. To use the term Grand Cru on the label, the wine must have been grown entirely in the designated area – the appellation – using only approved grapes and methods. Vinification must also be up to snuff, and the wines are bottled on site to further guarantee authenticity. VQA wines follow similar standards, and the VQA symbol is a guarantee that the wine is from the named region. But not all home-grown wines get to be VQA.

Do You VQA? Perhaps Not
Ontario has four distinct classes of wines, three of which are 100% Canadian.
VQA: The Vintners’ Quality Alliance of Ontario is Ontario’s appellation system. Wines that carry the VQA symbol have been grown in designated vinicultural regions using approved grapes and vinified using approved methods. VQA wines must be 100% Ontario-produced and must also pass muster with a tasting panel. VQA’s standards are among the highest in the world. Ontario's VQA wine regions are Niagara, Lake Erie North Shore/Pelee Island, Prince Edward County, and Ontario if the grapes came from more than one region (e.g. Niagara and Prince Edward County).

Cellared in Canada: A limited number of Ontario’s wineries (25 out of more than 160) are allowed to produce wines made from imported wine blended with a portion of Ontario wine. The ratio has been modified from its original 50/50 a number of times, and now stands at 30% Ontario wine to 70% imported wine. These wines can also contain up to 25% water! The required Ontario content has been regularly lowered to accommodate a small harvest (even as low as 1%), but it has never been increased in the event of a larger than anticipated harvest. CIC wines currently make up about 80% of so-called Ontario wine sales.

Fruit Wines: Fruit Wines of Ontario oversees the Quality Certified (QC) system for wines made from something other than grapes: fruits, berries, honey, and such. The standards are similar to VQA and specify that all produce used in these wines is Ontario grown and that the wines adhere to rigorous standards. Fruit wineries may not join the Wine Council of Ontario if they don't grow wine grapes, may not use the word Ontario on their labels, and face certain restrictions in their access to Ontario markets.

Orphan Wines: Many Ontario-grown and produced wines have no certification – no birthright – for one reason or another, and therefore are not even recognized as products of Ontario. These wines may not use the word Ontario anywhere on their labels and packaging. Both grape- and fruit-wines can appear in this group. Of all the reasons cited for not applying for VQA or QC status, the cost of certification is the most common. The wines are taxed differently and market opportunities are limited.

What it all means
Only you can decide what your wine buying priorities are. If your main objective is to buy as cheaply as possible and still support the local wine industry, then you're likely forced to stick with CIC wines, although I have seen prices on these wines that approach abusive: $13.95 for a wine that is 70% of unknown origin and may even contain water? No thanks! Moreover, I have purchased many wonderful VQA wines for under $10 and even as low as $6.95.

If you want to support real Ontario wine and don't mind paying a bit more on occasion, then VQA is an easy choice. If you shop only at the LCBO, then go straight to the VQA display, but watch out. CIC wines occasionally get mixed in, which the store is not supposed to do. (Check out the VQA wines on my Wine of the Week blog.)

For the full local wine (loca-vin?) experience, head for the wineries. That's where you'll find the best selection. The LCBO carries just a few labels from fewer than half Ontario's wineries, although the Vintages offerings are getting better at including VQA wines. If, while at a winery, you try a wine that you like but it isn't VQA, ask why. Certification is expensive; it's also unforgiving. It may add unreasonably to the price of a small lot wine to have it certified. Or the wine may be made from an orphan grape, one that the governing bodies don't approve of. Too bad. I've had some excellent Ontario wines that were made from non-approved grapes. VQA wines also go through a stringent chemical analysis, and you may be told that the wine’s acidity was off by .5% and it cost too much to resubmit.

If your goal is to experience Ontario's many terroirs, then stick with VQA or visit the winery. There is no "sense of place" in a blended wine most of which came halfway round the globe.
Now for the bad news. I am one of the few tasters in our little wine writers group that always tastes the CIC wines. I think it's important that I have a baseline on what's being offered in this price and style category. My expectations are not high, but frankly it's become a lesson in how low the bar can be set. I can recall only two CIC wines that I'd consider drinkable, and I've tried pretty much all of them. It's also the category that contains the most atrocities. It baffles me that someone will produce and knowingly release a terrible wine. One the positive side, there's sure to be lots of it!

What CIC Really Means

There's no way to discover the motives behind the switch from Product of Canada to Cellared in Canada. It may have been a response to consumers' confusion and anger over products labeled Canadian when they in fact were not. Many products bear the Product of Canada label. The official criterion here is that the majority of production costs must be incurred in Canada, not necessarily the product itself. CIC easily wines fall into this category, as just the cost of a bottle often exceeds the cost of the cheap imported wine that goes into that bottle.

The word “cellared” is supposed to help the buyer understand that there's more to wine than bottling and labeling. There's, uh, cellaring for instance. That means that the wines were parked in a humongous tank for a period of time. Hmmm... It's a bit like parking a Lada in your garage for a month or two, perhaps adding some seat covers and a bit of chrome, and then claiming it's somehow become a Product of Canada.

When the term Cellared in Canada was first announced, I thought it was a brilliant move. How better to continue to produce offshore product, package it as Canadian, and continue to lead the public to believe that it's domestic wine? Cellared in Canada has been a huge success. Consumers flock to Vincor (Wine Rack) and Peller (Vineyards) stores and the LCBO to scoop up millions of bottles of CIC wine in the belief they are buying local. CIC wines do help the industry. They provide a market for our grapes and employment for our neighbours. And they drive more money into Ontario's economy than does a bottle of imported wine. But no one – at least no one at the top – had been paying attention to the ancillary damage. Canadian wines still suffer from a dismal view on our own shores. That's not a result of us being too modest to brag about the 100s of VQA wines that have brought home international awards. It's caused by the cheap plonk that floods the LCBO's Ontario sections.

What Cellared in Canada really means is this: Blended and Bottled in Canada (I like to call them BBC wines). That's the terminology that wine jurisdictions around the globe use, because they, too, produce that type of wine. Canada could have gone the same route but chose not to. Instead we continued with the shady obfuscation. It's interesting to note how quickly Ontario's decision makers have changed course. When it became general knowledge that the labels were at best confusing, and at worst deceptive or even fraudulent, sales suffered. And when that happens, the big players scream loudly. My read is that if the public and the press had not reacted to the Vincor Olympics fiasco, then we would likely never see any change to the content, labels or wine store shelves.

The Mountain Moved

Sorry, not a sexual reference. While we were all busy whining about CIC wines and the state of the Ontario Wine Industry, the government was doing something useful. Yes, the people spoke and the public servants actually listened. On Oct 14, 2009, the Government of Ontario announced significant changes to the wine laws. Certain important issues were completely ignored, but some of the rules that were keeping the industry needlessly unhealthy are going to change.

Beginning with the 2010 harvest, Cellared in Canada wines will be required to have 40% Ontario wine inside, up from 30%. Even better, the content must be per bottle, not the previous “per all the bottles we make and whatever else, more or less”. Under the old rule, a bottle of CIC wine could be 100% imported, as long as the winery produced enough VQA wine to offset the imported content. Another improvement is that the wineries will no longer be allowed to add water to stre-e-e-etch CIC wines. That means the wines will truly be 40% Canadian.

CIC domestic content will then increase by 10% each year until 2014, at which time the requirement will drop to zero. Huh? The rationale here is to save Ontario grapes for making Ontario wines. That will result in more emphasis on producing local wine while putting CIC wines firmly in the import category. (It will be interesting to see if the Chilean section fills up with Jackson-Triggs white label wines.)

Labeling is another issue that's being looked at, but at this point no one seems to know what an honest label looks like. Interestingly, the Wine Council of Ontario has retained a polling company to interview folks and come up with a means of clearly labeling CIC wines. It's interesting that when the goal is to simply be honest, the industry's main players have to get outside help to learn how to do that. There are some tax issues as well, all favouring VQA wines while softly penalizing CIC wines.

But don't start celebrating just yet. This new plan does nothing to help the 50 or so wineries and grape-growers who have no market this year, and who may end up in receivership. One winery has already closed its doors – foreclosure for an amount that, according to the winery's owner, could have been realized by just one season of farmers market wine sales. I'll keep you posted on any new developments.
- tfo