Month: November 2025

The BCLDB (the government wholesale liquor monopoly) releases a quarterly Liquor Market Review, which often contains useful information on wine sales and trends in the BC marketplace. They recently released the review for Q2 of 2025-2026 which covers off the sales period from July-September 2025. Compared to the previous year, wine sales declined by 2.3% for this quarter (about $7m in value on total sales of $289m).

During this time, the BC Government maintained a direction to BCLDB wholesale to stop importing US alcohol products and to remove such products from the shelves of BC Government liquor stores. Existing stock remained for sale in private channels (e.g. private retailers, bars, restaurants). Compared to a year earlier, sales of US wines dropped dramatically during this quarter – down over 73%. 

Where did those customers go? The recently released numbers show that those customers mostly continued to buy wine (although sales were down just over 2% as mentioned) … and that mostly they switched to other import countries. Here are the statistics for the larger wine regions.

Country	2024 Q2 (000s)	2025 Q2 (000s)	% change
Argentina	5987	7346	+23%
Australia	10110	11695	+16%
Canada BC	146626	149039	+1.6%
Chile	10723	11681	+8.9%
France	25769	27587	+7%
Italy	28195	30027	+6.4%
NZ	13386	15307	+14%
Spain	5406	6151	+14%
USA	28390	7547	-73.4%

Here are a few observations from the above numbers.

– Firstly, there’s only a small 1.6% sales increase for the “Canada BC” category. In the previous quarter, this category had logged a 6% sales increase. However, I note that the BCLDB includes both “blended in Canada” wines (made from imported grapes/juice) and 100% BC wines in this group, so that complicates the analysis. The sales numbers for 100% BC wine, and for individual wineries, may be different. These numbers are further complicated by the presence of vintage replacement wines (mostly made from U.S. grapes) in the marketplace.

– Some countries have been big winners … notable sales increases for Argentina, Australia, New Zealand, and Spain … with smaller increases for Chile, France, and Italy. This should obviously worry US producers as it may be hard to get these customers back once the trade issues get resolved.

– Local importers who were able to bolster their losses in U.S. sales with increases from their non-U.S. winery clients may have been able to survive a tricky quarter … but importers whose portfolios were more dependent upon U.S. sales will have experienced a very challenging economic quarter. There is no doubt that some importers will have had to take drastic action as a result, particularly as large amounts of U.S. inventory are generating few sales. 

– The continued decline in overall wine sales (down again by over 2%) is worrying for the wine industry overall. Whether this is due to changing demographics, general economic worries or health concerns, it is troubling to see erosion in a market that once saw continuous growth.

– The above figures are for wholesale sales … they are probably also representative of retail sales but there could be some differences.

My recent review of alcohol sales and government liquor tax revenue reveals some interesting points which may have implications for future liquor tax policy across Canada and elsewhere. Canada’s provincial governments have relied upon liquor revenue to contribute to their general operations since Prohibition. However, that reliability appears to be threatened as declining consumption and high prices are now resulting in falling levels of liquor revenue on a per capita basis in certain places.

Statistics Canada tracks the amount that government makes from liquor sales across Canada and provides continually updated data here, which can be segregated by year and by province. Here are the total liquor board contributions to government revenue for the most recently available 3 annual periods and for four select provinces. I have added “per capita” contributions to provide a point of reference comparison (I used general population, although I suppose it could arguably be more useful if this was limited to drinking age).

BC	2021/22	2022/23	2023/24
Liquor Revenue	1.193b	1.193b	1.130b
Per Capita Amount	222.69	216.31	199.25
AB
Liquor Revenue	854m	825m	791m
Per Capita Amount	189.23	175.94	161.13
MB
Liquor Revenue	322m	327m	323m
Per Capita Amount	227.88	225.05	216.49
ON
Liquor Revenue	2.543b	2.457b	2.574b
Per Capita Amount	167.79	157.17	159.43

There are some interesting takeaways that can be extracted from the above. 

– Overall, annual government liquor revenues are fairly flat despite these years being fraught with inflationary pressure. But in AB, revenue is actually down by about 7%. The “per capita” amounts of government liquor revenue have also mostly decreased. In BC, revenue is down on a per capita basis about 10% over 2 years. In ON and MB, it’s down about 5%. But in AB, it’s down almost 15%.

– The above may explain AB’s recent introduction of a contentious “high value” percentage based wine tax … as an attempt to boost revenue. But this seems a particularly ham-handed way to do it as the most reliable way to increase revenue would be to increase the flat (volume-based) tax on all alcohol, not just target wine in a complicated way that makes the tax almost impossible to administer. My guess is that they will not increase revenue by the amounts that they want and will have to revisit this approach.

– The other provinces are likely worried about the fact that revenues are either flat or declining during a time of increased prices and increasing population. This does not augur well for liquor’s ability to “contribute” to government revenue, particularly if consumption continues to decline. As I noted in an earlier article, it may be time to re-think the policy behind liquor markups and consider changing how they are administered. Recent experience in the UK shows that significant increases to alcohol taxes can actually result in decreased government revenue in today’s complex consumer liquor marketplace.

– Manitoba, which is the only Canadian province, to have completely open borders for interprovincial DTC (direct to consumer) alcohol shipping, has the highest amount of per capita liquor revenue of all of these four provinces. This may be partially due to high MB liquor markups but, regardless, it confirms my belief that the DTC issue will not significantly affect provincial liquor revenue. Indeed, the province with the most open borders actually has the highest revenue!