Ontario Wine Trip

Canadians have been making wines for more than two centuries. The quality of the wine is among the best in the world. Ontario wines have captured domestic and international recognition by garnering significant wine medals in competitions around the world.

Many small and family run wineries have put the time and effort to produce spectacular wines.

The Great Wines of Ontario

The signing of the North American free trade agreement in 1988 and the rulings within the General Agreement On Tariffs And Trade (GATT), required Canada to abandon the protection it offered its wine industry. This required wineries to invest in new equipment and expertise in order to produce better and more marketable wines. New vineyards were planted with only the finest varieties of grapes Chardonnay, Riesling, Sauvignon Blanc, Pinot Gris, gewürztraminer, pinot Noir Cabernet sauvignon, Merlot and others.

Canadian quality wines and especially the premium wines produced in Niagara Falls region of Ontario began to capture international recognition and sales of Canadian wines began to grow at an impressive rate.

Market Overview

Like other food producers and manufacturers, most wineries, especially the small-median sized firm in Ontario are facing 3 key challenges:

• Our strong dollar and US recession, reduced purchase power which directly affected wineriy export volume. The United States is the largest market for new world wines with sales of 12 billion.
• New larger and well financed wineries invested in Ontario and BC. These corporations used their extensive production experience and financial resources to produce more efficiently which increased the level of domestic competition.
• Internationally grape surpluses in various regions of the world have resulted in many lower-priced subsidized imported wines entering the Ontario market and offering cheaper products internationally.

The market was consolidating in terms of its retail, wholesale and production operations.

Image Selling Your Wine to 1.3 Billion Consumers

Chinese grape wine market was worth approximately CNY 40 and 70 billion (roughly $5 - $9.5 billion) in 2006.

• Overall volume of sales for grape wine increased 6% from 2005 to 2006.
• Chinese GDP Growth is 9% annually and will stay at this constant percentage for the next five years.
• There is a new consumer trend of wine consumption.
• Canadian ice wines are extremely popular with the middle class and wealthier consumer groups.

Who Is Already In China?

Australian wineries achieved a remarkable success in the Chinese market. The Australian wine industry was restructured to be able to deliver large quantities of high-quality braded wine to international markets. They can do this at lower costs than many of their competitors. Australia had a very limited domestic market with a population of 18 million so the wineries realized that growth depended on international expansion.

Impact for Ontario

JJICA has done extensive research and recognizes the opportunity that exists to sell Canadian wines in China. More specifically, because we foresee an emerging and sustained demand for wine from Chinese consumers, we believe that Canada is well positioned to take advantage of that market. We have developed contacts in various provinces with wine merchants, distributors and large retailers and we use those networks to introduce Canadian wines and foster profitable and long-term partnerships between Canadian wineries and Chinese distributor and retailers