The themes that stand out for me about 2017 in the BC wine industry, aside from the US renewal of its WTO challenge and the elevation of the Comeau case to the Supreme Court of Canada (about which much has been capably written by a number of industry observers), may be summarised in two words: Consolidation and Investment.

Consolidation
In 2017 several very interesting and successful wineries in their own right took us by surprise by announcing they were being acquired by Andrew Peller Ltd. and Arterra Wines Canada, Inc. Peller announced its purchase of Tinhorn Creek Vineyards, Black Hills Estate Winery and Gray Monk Estate Winery in September. In late November Arterra announced its purchase of Laughing Stock Vineyards.

What to make of these moves? While some BC wine lovers expressed concern about a shift they detected to the “corporatisation” and possible “homogenisation” of BC wine, it isn’t clear that either charge is valid – yet. The sheer number of wineries and diversity of ownership structures in BC work against the charge that the industry is in danger of becoming corporatised. There are simply too many committed, independent (and independent-minded!) proprietors in the industry today who are in for the long haul. As for homogenisation, it is apparent that the wineries – and vineyards – were not acquired by Peller and Arterra merely to fold them into their more generic bottlings, but rather to continue their individual expressions of quality and place within the Okanagan Valley.

More generally, from a business perspective, these acquisitions signal that Canada as a whole is now the chessboard for – yes – positioning corporate power over brands by the large commercial wineries. But I read it as much as a race to place bets on highly promising vineyard sites, which will be developed by deep(er) pockets and possibly yield that elusive top-flight flagship bottle for which the Okanagan (and its future sub-GIs?) becomes famous.

Another obvious proponent of this strategy is Mission Hill Winery/Von Mandl Family Estates, which stayed on the sidelines of the 2017 acquisition spree, but opened two new wineries and controls 10% of the vineyard acreage in the Valley. Martin’s Lane quietly opened in June, and CheckMate Artisanal Winery opened its pop-up doors in August. The sharp focus on vineyard specific bottlings (albeit out of purchasing power range of many BC wine lovers) by these two in particular indicate the view that BC’s best chance to stride onto the world wine stage will be from individual, even bespoke wines, not homogeneous or generic BC wine labelled “Okanagan Valley”.

Investment
To bridge themes from Consolidation to Investment, another acquisition catching our attention in 2017 was Phantom Creek Estate’s purchase of a portion of C.C. Jentsch Cellars’ vineyards on Golden Mile Bench. The scale of Phantom Creek’s investment – reportedly in the C$100 million range – in the south end of the Okanagan Valley is bookended at the north by a reported C$50+ million winery investment in Lake Country by the O’Rourke family. The scale of investment is striking, and prompts the hope that the BC industry is at a tipping point for the level and type of investment it can attract. This does NOT downplay in any way the hard work and substantial investments made over the years by long-time and newer proprietors.

To put it in perspective, a comparison may be useful: I recent came across a Vancouver Sun article from September 10, 2005, entitled “Okanagan wineries pour big money into development.” In it, a youthful Tony Stewart is pictured noting that Quails’ Gate was investing $4.5 million, principally in storage facilities and visitor amenities. Twelve years later, the top-line investment dollars are orders of magnitude larger.

If one is allowed New Year’s wishes as well as resolutions, mine is that the scale and sophistication of the new investments could well be indicative that a much-needed evolution is also underway in how the BC industry as a whole organises, governs, promotes and exports itself.

Happy New Year to all who contribute so much – past and present – to the success of BC wine.

Cheers!
Karen

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