After the exclusion of alcohol from an agreement this week aimed at reducing interprovincial trade barriers, some members of the alcohol industry express confusion and disappointment, feeling they have waited too long for the provinces to implement changes.
Recently signed by the provinces, territories, and federal government, the agreement pledges to eliminate restrictions on the movement of certain goods across Canada. Notably absent from the list are food and alcohol, with the alcohol industry advocating for barrier removal long before U.S. tariffs initiated efforts to facilitate free trade between provinces.
Adin Wener, managing partner of Toronto’s Henderson Brewing Company, voiced his disappointment, emphasizing the need for unity, especially in light of tariffs affecting trade. With breweries no longer shipping to the U.S., the industry had high hopes for accessing new markets.
Although some provinces plan to streamline direct-to-consumer alcohol sales by next spring, industry stakeholders are growing impatient, doubting the likelihood of these changes materializing.
The alcohol industry in Canada faces various economic challenges, including declining consumption, rising input costs due to inflation, and increased prices of aluminum cans following U.S. tariffs. Interprovincial trade barriers exacerbate these issues, leading to additional shipping costs, varying packaging requirements, and pricing discrepancies for out-of-province alcohol.
Despite a memorandum of understanding signed by nine provinces and one territory in July to remove barriers to direct-to-consumer alcohol sales by May 2026, industry representatives remain skeptical, citing the complexity of regulations and prolonged discussions on the matter.
Economist Moshe Lander argues that by excluding alcohol from the agreement, provinces are perpetuating the same mistakes that created interprovincial trade barriers initially. Revenue considerations from provincially regulated retailers like LCBO in Ontario and SAQ in Quebec likely influence the provinces’ stance on keeping alcohol off the table for now.
Lander emphasizes the potential impact of removing barriers on provincial revenues and local producers, highlighting the importance of balancing competition with the preservation of local jobs and tourism.
While some progress has been noted by industry insiders, Lander remains doubtful that the barriers will be dismantled, citing the necessity of unified political will among the provinces.