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Ontario consumers face the bizarre prospect of empty shelves in some grocery stores once strict new guidelines on supermarket beer retailing come into effect within the next few months, the Star has learned.
That’s because beer sales will be limited to the equivalent of fewer than 300 six-packs a day under the new rules.
As part of an upcoming agreement with the brewing industry, Queen’s Park has decreed that only 46 million six-packs will be allowed to be sold a year at 450 of Ontario’s 1,500 supermarkets by 2018.
There will be unspecified penalties for retailers who try to sell more than their allocation, insiders say.
The annual limit works out to the equivalent of 279 six-packs — or about 70 cases of beer — sold daily per store.
Sources say the move appears to be helpful to the 448-outlet Beer Store, which has enjoyed a virtual monopoly on suds in the province since the repeal of Prohibition in 1927.
Company officials, who have always said they would co-operate with the government's reforms, were not available for comment late Thursday.
The Beer Store will be the only place consumers can buy 24-packs though 12-packs will be available in some Liquor Control Board of Ontario shops.
While the government promised on April 16 that the first Ontario supermarkets would be selling beer by Christmas, Finance Minister Charles Sousa said there are still some hurdles to clear.
“All the agreements are now being negotiated and those things take time,” Sousa said Thursday at the flagship Summerhill LCBO store where he announced that refillable “growlers”— large bottles that hold roughly a six-pack — will be sold.
“There’s going to be announcements up till Christmas but I’m not going to force something into play that doesn’t give the grocers enough time to prepare themselves,” the treasurer said.
“We want to get this right. People are going to have access to alcohol anyway,” he said, adding supermarkets will begin bidding on the sales licences before the end of this year.
“I’m excited. We’re in the final stages of getting this done and things will happen. Things have not changed in almost 90 years. We also want to be sensitive to the geography and the locations of those grocers. We want the mid(-size) players as well as the big players to win some of the licences.”
Sousa, noting there will soon be “craft beer zones” in 25 of the LCBO’s 651 stores, said the changes in the hopper are good news for consumers and for the burgeoning microbrewery industry.
“Now we’ve got all these craft brewers expanding and growing within the province,” he said, referring to the 100 small breweries employing about 1,000 people in communities throughout the province.
In comparison, Labatt, Molson, and Sleeman —the foreign-owned brewing giants that control the Beer Store — employ around 2,000 workers in Ontario.
Craft beer, already a fast-growing sales category at the LCBO and Beer Store, is expected to become even more popular because the government will mandate that retailers give microbrewers 20 per cent of shelf space.
Bob Peter, president and CEO of the LCBO, pointed out the provincial owned booze monopoly already carries beers from 70 different Ontario craft brewers.
“Since 2006, sales have grown more than 630 per cent — there’s no other category that’s even close. There’s a true love of local,” said Peter.
Cam Heaps, co-founder of Toronto’s Steam Whistle Brewing and chair of Ontario Craft Brewers, said the boom is good for the economy.
“We’ve got educational programs now where you can go and be a brewmaster, we’ve got people growing hops all of sudden, we’ve got stainless steel tanks and equipment that can all be made here,” said Heaps.
Meanwhile, the government’s plan to also sell wine in 450 supermarkets is delayed.
Ed Clark, the former TD Bank CEO tasked by Premier Kathleen Wynne to monetize provincial assets to bankroll transit, roads and bridges, is not expected to have his report on wine sales completed until later this year.
Clark, who will be at Queen’s Park on Friday to disclose further details on the previously announced initial public offering of Hydro One, had originally hoped to have his wine study done by next Tuesday.
International trade agreements and other complications mean it is unlikely there will be an expansion of wine sales into grocery stores until well into next year.