Viticulture in Huron County

Home , Henry of Pelham Winery, List of grape varieties

Huron County Economic Development

Business Case

November 9, 2020

NOTICE OF CONFIDENTIALITY

The content of the present report is private and confidential and cannot be reproduced, in full or in part, except with the consent of Huron County Economic Development. The recipient promises to preserve the confidential nature of the information contained in the present document and will take all necessary actions to prevent non-authorized copying, divulgation or transmission, in part or in full, of this information to unintended parties.

The recipient also promises not to use, modify, translate, adapt, convert or exploit the content of the present document without written consent from Huron County Economic Development.

TABLE OF CONTENTS

1. Executive Summary ...... 1 2. Strategic Context ...... 2 2.1 Business Needs and Desired Outcomes ...... 3 2.2 Opportunity Objectives ...... 3 2.3 Detailed Description of the Opportunity ...... 4 2.3.1 Grape Description ...... 4 2.3.2 Description of a Vineyard and its Growing Season ...... 5 3. Analysis ...... 10 3.1 Evaluation Criteria ...... 10 3.1.1 Vineyards Throughout Ontario ...... 10 3.1.2 Market Size ...... 10 3.1.3 Growing Degree Days ...... 19 3.1.4 Growth Potential and Trends ...... 20 3.1.5 Grape Prices ...... 25 3.1.6 Staffing Costs and Job Descriptions ...... 27 3.1.7 Alignment with Huron County ...... 30 3.1.8 Zoning Bylaws ...... 31 3.2 Supply Chain Description ...... 32 3.3 Vineyard Establishment ...... 33 3.3.1 Site Selection ...... 33 3.3.2 Climatic Requirements ...... 34 3.3.3 Land Preparation and Soils ...... 35 3.3.4 Variety Selection ...... 38 3.3.5 Winter Freeze Damage and Spring Frost Ratings for Grapes at Vineland Station, Ontario ...... 38 3.3.6 Training the Young Vine ...... 39 3.3.7 Pruning and Training Systems ...... 40 3.3.8 Cold Climate Maintenance Practices ...... 41 3.4 Implementation Cost ...... 42

3.4.1 Financial Analysis - Assumptive Model #1 ...... 42 3.5 Economic Impacts ...... 52 3.5.1 Ontario Economic Impacts ...... 52 3.5.2 Canadian Economic Impacts ...... 54 3.6 Project Financing ...... 55 3.6.1 Productivity and Competitiveness ...... 55 3.6.2 Business Development and Growth ...... 56 3.6.3 Market Access ...... 56 3.6.4 Protection and Insurance ...... 56 3.6.5 Research and Development ...... 57 3.6.6 Workforce/Labour ...... 57 4. Conclusion ...... 58 5. Recommended Next Steps ...... 58 5.1 Four Point Plan ...... 59 5.1.1 Marketing ...... 59 5.1.2 Human Resources ...... 59 5.1.3 Financing ...... 59 5.1.4 Production ...... 59 6. Bibliography ...... 60

TABLE OF TABLES Table 1 - Number of Growers Registered with Grape Growers of Ontario (Table Format) ...... 16 Table 2 - Number of Growers Registered with Grape Growers of Ontario (Chart Format) ...... 17 Table 3 - Wine Sales in Ontario (by Volume, ‘000s litres) (Table Format) ...... 18 Table 4 - Summary of Growing Degree Days and total rainfall across Ontario’s Appellations ... 19 Table 5 - Date of key phenological stages at select locations within Niagara Peninsula (2019) ... 19 Table 6 - LCBO Forecasted Sales Targets (2018-2021) ...... 21 Table 7 - Grapes for Processing Prices (2020) ...... 25 Table 8 - Variety Selection ...... 38 Table 9 - Winter Freeze Damage and Spring Frost Ratings at Vineland Station ...... 39 Table 10 - Total Establishment and Operating Costs ...... 43 Table 11 - Mature Vineyard: Annual cost ...... 43 Table 12 - Mature Vineyard: Annual Operation Costs ...... 44 Table 13 - Break Even Yield to Cover Total Costs (Cabernet Franc) ...... 45 Table 14 - Total Establishment and Operating Costs ...... 46 Table 15 - Mature Vineyard: Annual cost ...... 46

iii

Table 16 - Mature Vineyard: Annual Operation Costs ...... 47 Table 17 - Break Even Yield to Cover Total Costs (Chardonnay) ...... 48 Table 18 - Total Establishment and Operating Costs ...... 49 Table 19 - Mature Vineyard: Annual cost ...... 49 Table 20 - Mature Vineyard: Annual Operation Costs ...... 50 Table 21 - Break Even Yield to Cover Total Costs (Vidal) ...... 51

TABLE OF FIGURES Figure 1 - Vineyard Acreage in Ontario (2019) ...... 11 Figure 2 - Distribution of Ontario Grape Growers (2019) ...... 11 Figure 3 - Total Tonnage by Category (2019) ...... 12 Figure 4 - Sales of Wine Grapes in Ontario (2019) ...... 12 Figure 5 - Vinifera Harvest in Ontario (2019) ...... 13 Figure 6 - European Hybrid Harvest in Ontario (2019) ...... 13 Figure 7 - Wine Grape Harvest in Ontario (2019) ...... 14 Figure 8 - Average Price Per Tonne (Total Crop Value of All Grape Varieties) ...... 14 Figure 9 - The Top Varieties of Grapes in Production in Ontario (2019) ...... 15 Figure 10 - Ontario Customer Favourites ...... 23 Figure 11 - Ontario Customer Not-So-Favourites ...... 24 Figure 12 - Wine Industry Supply Chain ...... 33 Figure 13 - Four-Cane Kniffen (labrusca, hybrids) ...... 40 Figure 14 - Pendelbogen (vinifera) ...... 41

TABLE OF CHARTS Chart 1 - Wine Sales in Ontario (by Volume, '000s litres) (Chart Format) ...... 18 Chart 2 - Sales Now and the Road Ahead ...... 21 Chart 3 - Customer Preferences for Ontario Wine ...... 24 Chart 4 - LCBO Wine Market Share ...... 25

1. Executive Summary

The Huron County Economic Development Department sought out the expertise of a research and consulting firm to identify, assess and develop a supporting business case which could be utilized to assist a viticulturists, an existing farmer or prospective investor with establishing a Huron County-based vineyard in the cultivation and harvesting of grapes for the purposes of being turned into wine. The objective is that this type of agricultural activity could lead to new employment opportunities, increase farm receipts, enhance local tourism, export development, contribute to local brand awareness and development, among other benefits that would be felt regionally. A detailed description of the opportunity introduces three (3) specific grape varieties which formed the basis for pursuing many necessary components found within the report including yield identification and the financial analysis. The three (3) varieties of grape included the Vidal (a European white hybrid grape), Chardonnay (a white vinifera grape) and a Cabernet Franc (a red vinifera grape). Additionally, a detailed description of a vineyard’s typical growing season provided a thorough understanding of the various stages of growth which a vine transitions through during the season. An in-depth analysis entailed a review and understanding of the density of vineyards throughout Ontario, which includes more than 180 wineries, representative of more than 17,000 acres of vineyards. This level of production represents 71% of Canada’s wine volume, while the Niagara Peninsula accounts for over 93% of Ontario's grape-growing volume. Grape growers within the province that are registered with Grape Growers of Ontario are categorized into one (1) of six (6) distinct districts throughout the province. Huron County falls within District 6 which consists of Prince Edward County and all other geographic areas not included in Districts 1 to 5. District 6 is the only of the six (6) districts which have seen year-over-year increases in the number of growers with production registered with Grape Growers of Ontario. Despite these grape growing regions, the province’s three (3) designated Viticultural Areas (VAs), or appellations of origin include Niagara, along the Lake Erie North Shore and throughout Prince Edward County. When evaluating market size and growth potential, experts are cautious about making long-term industry forecasts for more than what seems to be the subsequent year. The LCBO however, has forecasted sales targets of Ontario VQA wines which reveal year-over-year average growth of 8.8% throughout the 2019/20 and 2020/21 fiscal years. This is in comparison to average annual sales growth targets of ICB wines which is closer to averaging 4.4% year-over-year growth throughout the same period. A deeper dive into understanding these differing growth projections took into consideration changing and consumer preferences, changing formats, changing expectations, and the coronavirus effect on wine consumption. Critical to the success of any vineyard are the people employed. A review of the workforce requirements offered insights into labour requirements including the challenges in both attracting and retaining staff. Two (2) active job postings included within the report provide a glimpse into the types of requirements from two (2) Ontario-based vineyards.

The study continued with a review and assessment tied to the alignment of this type of agricultural activity within Huron County and considered the quality of the local land and soil, zoning bylaws, climatic conditions and site selection requirements (from an investor’s perspective). A portrayal of the wine industry supply chain (from producer to consumer) offers insights into the many stages of the wine making process from a vineyard to being consumed by the end-user. The financial analysis presents the approximate establishment and operating costs associated with the three (3) aforementioned grape varieties and what their break even yield to cover total costs are. The financial analysis summarizes the establishment and operation costs associated with the preplant year, followed by the planting year and the first three (3) years of growth before being considered a mature vineyard. The revenues are calculated using the most recently reported grape prices (July 2020) as posted by the Grape Growers of Ontario. A review of the economic impact of the wine industry shines light on the many direct and indirect benefits which are felt locally, provincially and that benefit Canada as a whole. To assist in moving forward with such an investment, a number of funding programs are presented, however, it is recommended that a serious investor speak directly with a regional/territory representative on behalf of Ontario’s Ministry of Agriculture, Food and Rural Affairs, in addition to Agri-Food Canada and the Grape Growers of Ontario to ensure a sound understanding of the most up-to-date rules and regulations, while also being introduced to other appropriate industry associations and funding agencies for continued dialogue.

2. Strategic Context

Ontario is home to a wide array of grapes which are grown for wine, juice, grape products (such as jams, jellies, preserves) and fresh market consumption (Grape Growers of Ontario). More regionally, Huron County is well known as a thriving grape growing and wine producing region.

The world’s highest quality wine grapes belong to a species of grapes known as Vitis vinifera (commonly referred to as Vinifera), which are native to Europe. In Ontario, the majority of commercial wine grape species are viniferas, and include varieties like Chardonnay, Cabernet, Gamay, Merlot, Pinot Noir, Riesling, etc.

Native North American vines belong to the species known as Vitis labrusca and include such varieties as Concord and Niagara. These typically produce the best juices, jams, jellies and preserves, and are not used in winemaking in Ontario.

This report will focus on the cultivation of wine grape production with an emphasis on the varieties which have a proven track record and are most likely to prosper throughout Huron County’s annual climatic conditions.

The purpose of this market study and business case is to inform local stakeholders, especially Huron County farmers about opportunities linked to viticulture, which is the cultivation and

harvesting of grapes. This business case provides market perspectives, and understanding of its supply chain, vineyard establishment, operational requirements and a financial analysis.

A 2012 study undertaken by Huron County revealed that Huron County possess “a growing season with adequate number of growing degree days and a favourable Heliothermal Index that can support the commercial production of a range of cold-hardy, early to mid-season, Vitis vinifera varieties (Huron County Economic Development Services and Huron Business Development Corporation, 2012). The Heliothermal Index (HI) is one of the most common methods used to identify suitable areas for viticulture, using sums of air temperatures and latitude of locations (Neumann & Matzarakis , 2013).

Identified as a way to support a diversified agriculture sector, it was recommended to continue explorations into the potential for a viticulture industry as an immediate action of the subsequent five (5) years (Huron County, 2011). As a longer-term action item beyond the subsequent five (5), the recommendation to develop viticulture with sustainable best practices was an identified recommendation to promote and market the use of environmental best practices in the agricultural industry.

Related to this business case and in consultation with the Huron County Economic Development Department, it was determined to focus on addressing more regional opportunities tied to the vineyard industry. Given the abundance of ideal soil conditions, it has become favourable to further explore and understand vineyard establishment as a way to help diversity the agricultural activities within and throughout Huron County while also considering this as a value-add crop as a way to increase farm receipts.

This analysis and supporting business case will focus on understanding the industry, the market size and growth potential and establishing a vineyard for a prospective investor.

2.1 Business Needs and Desired Outcomes This business case supported market study is intended to work towards the establishment of one (1) or more wine grape growing vineyards within Huron County. A desired outcome would be for sufficient levels of commercial production to take place which meet the quality and quantity requirements to become a contract supplier for a commercial winemaker.

While not a focus of this business case (given the specific varieties of wine grapes being considered), a secondary outcome of this would be to position this opportunity for the cultivation of more native North American vines which yield grapes more commonly used in the production of juices, jams, jellies and preserves.

2.2 Opportunity Objectives For Huron County, increasing viticulture within the county offers the following opportunities:

• Leads to the creation of new employment opportunities;

• Enhances local tourism; • Contributes to strengthening the regional supply chain; • Creates export development opportunities; • Further develop Huron County as a thriving producer of grapes which supports and enhances local winemaking; and • Enhance local brand awareness and development.

2.3 Detailed Description of the Opportunity The activity of winemaking is comprised of two (2) aspects: viticulture and winemaking. Viticulture is the process of growing grapes, which can then be turned into wine during the winemaking process. The winemaking process itself involves the intake of grapes, which, through varying processes are then turned into wine to be sold through a variety of methods.

If the primary outcome (of this business case) is to establish commercial production beyond what would typically be considered as small farm operations, the opportunity then becomes the establishment of viticulture (or the growing of grapes) for the purposes of commercially supplying to the wine making industry.

2.3.1 Grape Description For the purposes of this business case and the embedded market study, descriptions of the following three (3) grapes are presented as they will be referenced and drawn upon throughout this report. These three (3) varieties include the Vidal (a European white hybrid grape), Chardonnay (a white vinifera grape) and a Cabernet Franc (a red vinifera grape). 2.3.1.1 Vidal (White Hybrid - European). This is one of the most widely planted hybrids in all of Ontario. It has a multitude of uses as a table wine, a late harvest wine and Icewine. It has a long growing season with harvest, most years, in mid to late October or later. The clusters are large with a conical shape and medium sized berries. It has tendency to carry a large crop and can benefit from crop thinning in years with excessive fruit set. The fruit is thick-skinned and the bunches hang well. The fruit has a relatively neutral flavour and maintains its acid levels Source 1 - (xtraWine) late into the year, making it a great cultivar for Icewine production (Grape Growers of Ontario).

2.3.1.2 Chardonnay (White Vinifera) The most widely planted vinifera cultivar in Ontario. It displays a moderately high vigor depending on the location and has an upright growth habit. It is reasonably cold hardy and matures in late September. The clusters are medium size, possessing a conical shape with a shoulder. Berries are round with a neutral flavour and the skin achieves a golden hue as the berries ripen. It is prone to powdery mildew and bunch rot. In Ontario, there are many clones of Chardonnay that provide a diverse flavour profile. A particular clone 77F is known as the Muscat clone that makes the wine known as Chardonnay Musque (Grape Growers of Ontario).

Source 2 - (Monrovia)

2.3.1.3 Cabernet Franc (Red Vinifera) The most productive and cold hardy red vinifera. It ripens about a week before Cabernet Sauvignon and can carry a crop load to full maturity that is 20% greater. It has medium size clusters that are conical and may have shoulders. The berries are blue, medium size and produce a juice with an herbaceous flavour. It is relatively tolerant of most diseases and is used as a varietal table wine or blended with others to produce a classic red wine (Grape Growers of Ontario).

Source 3 - (Vins de Bordeaux)

2.3.2 Description of a Vineyard and its Growing Season The following depicts the lifecycle of a grapevine through a series of illustrations and supporting descriptions which represent a typical growing season (Wine Folly, 2020).

A grapevine is an example of a perennial plant; one that grows or blooms over the spring and summer, dies back during the autumn and winter months and then repeats the cycle from its rootstock the following spring. Without human intervention, grapevines will naturally grow into a

bushy-tree-like mess of leaves and branches. Meticulous pruning and training help the vines stay organized and focus their energy on growing impeccable grapes.

The first year of growth in a vine’s life is meant to build up nutrient stores. For a vine to concentrate its energy on developing a robust root system, flower clusters are cut back allowing for the growth of the permanent wood (trunk) and the building of a robust root system. Producing fruit so early on is a lofty goal, to the vine’s detriment. Usually, by the third year of growth, a vine is ready to produce the fruit of proper quality for winemaking (Wine Folly, 2020).

One of the most expensive and most important activities in the vineyard (besides harvest) is winter pruning. The pruner cuts back the prior year’s canes and chooses the best canes to grow new shoots. The pruning system used is determined during the vineyard design, but it is possible to change the way vines are trained from season to season if vigor (over or underproduction) is an issue.

During April/May, the first signs of life occur, sap rises, and the buds begin to break. The buds are extremely delicate during this time, for spring hailstorms can destroy them.

The following represents the actual days which the buds began to break at four (4) Ontario locations in 2019.

Bud Variety Location Break Chardonnay St. Davids 14-May Riesling Niagara River 19-May Merlot Creek Shores 14-May Cabernet Beamsville Bench 16-May Franc Source 4 - (Grape Growers of Ontario, 2020)

After the buds break in early spring, they continue to grow. Some viticulturists prune the downward-facing shoots to ensure that all the shoots grow upward, reducing the potential crop size. This strategy involves reducing the quantity to increase quality because vines that produce limited numbers of grapes produce more concentrated grapes.

The flowers of grapevines are called perfect flowers: they pollinate themselves without the need for bees.

In June and July, young clusters begin to appear. These clusters will eventually become berry bunches.

The following represents the actual days which the grapes began to bloom at four (4) Ontario locations in 2019.

Bloo Variety Location m Chardonnay St. Davids 26-Jun Riesling Niagara River 30-Jun Merlot Creek Shores 01-Jul Cabernet Beamsville 01-Jul Franc Bench Source 5 - (Grape Growers of Ontario, 2020)

In mid to late summer, the green berries start to change colour and ripen. This period is called vérasion (“verre-ray- shun”), and it’s the most beautiful time of the year in a vineyard when the berries change colors from a vegetal green to yellow, pink, red or purple. Just before vérasion begins, some winegrowers do green harvesting, wherein a little excess weight is removed from the vines (the superficial grape bunches) so that the vines can focus their energy on their remaining grapes.

The following represents the actual days which vérasion began (the onset of the ripening of the grapes) at four (4) Ontario locations in 2019.

Variety Location Veraison Chardonnay St. Davids 28-Aug Riesling Niagara River 02-Sep Merlot Creek Shores 04-Sep Cabernet Beamsville 03-Sep Franc Bench Source 6 - (Grape Growers of Ontario, 2020) The wood continues to ripen throughout the summer, turning brown and hardening (e.g., vines lignify). In tandem with wood growth, the grapes continue to ripen, and sugar levels rise. Harvest usually occurs sometime between September to November when the grapes reach their perfect ripeness.

Viticulturists and harvesters work around the clock to pick the grapes in time. Grapes do not continue to ripen once picked.

In the late fall, some producers leave a few bunches on the vine for a late- harvest wine. Dessert wine comes from pressing these late picked and raisinated (dried out) grapes. At this point, the vine has stopped producing carbohydrates from the chlorophyll in the leaves. The leaves then lose their color and fall to the ground.

During the winter, the foliage dies off, pruners trim the vines, and the cycle begins again.

3. Analysis

3.1 Evaluation Criteria Based on previous work and in consultation with Huron County’s Economic Development Department, a series of evaluation criteria have been used to assess and validate the opportunity to increase the number of vineyards throughout the County.

The following evaluation criteria have been considered for the evaluation of this Business Case and the discussion behind these elements are expanded upon throughout this section:

• Vineyards Throughout Ontario • Market Size • Growing Degree Days • Growth Potential and Trends • Grape Prices • Staffing Costs and Job Descriptions • Alignment with Huron County • Zoning Bylaws

3.1.1 Vineyards Throughout Ontario The size of Ontario’s viticulture is estimated to include more than 180 wineries within the province which produces approximately 71% of total Canadian wine volume. Today, there are 17,000 acres of vines in eastern, southern and southwestern Ontario. With a focus on growing premium vinifera and French hybrid crops, viticulture is well established in Niagara, along the Lake Erie North Shore and throughout Prince Edward County. These are the province’s three (3) designated Viticultural Areas (VAs), or appellations of origin (Grape Growers of Ontario).

3.1.2 Market Size Ontario is the country’s leading grape producer, accounting for approximately 60 - 70% of all Canadian production. The Niagara Peninsula accounts for over 93% of Ontario's grape-growing volume. The total farm gate value of Ontario grapes exceeded $109 million in 2019 which benefited from a total of 17,000 acres of producing vineyards. In 2019, winemaking was the dominant use for Ontario grapes, which saw 98% of production used for wine products and 2% for juice, jams and other grape products (Grape Growers of Ontario).

The following presents a snapshot of the Ontario’s grape industry (Grape Growers of Ontario).

Figure 1 - Vineyard Acreage in Ontario (2019)

Figure 1 presents the total 2019 vineyard acreage in Ontario at 17,000 acres. It splits out the total acreage by Niagara, Essex Pelee Island Coast, Prince Edward County and the balance of Ontario. The Niagara Region maintains the dominant share of acreage, representing 87% of the 17,000 acres.

Figure 2 - Distribution of Ontario Grape Growers (2019) Figure 2 breaks down the percentage of the total number of growers in each district in 2019. • District 1: 38% and includes Niagara-on-the-Lake and Niagara Falls; • District 2: 7% and includes St. Catharines, Fort Erie, Pelham, Port Colborne, Thorold, Wainfleet and Welland; • District 3: 30% and includes Town of Lincoln; • District 4: 3% and includes Wellington and Hamilton, Grimsby and West Lincoln; • District 5: 8% and includes Brant, Chatham-Kent, Essex, Elgin, Haldimand, Lambton, Middlesex, Norfolk and Oxford; and • District 6: 14% and includes Prince Edward and all other geographic areas not included in Districts 1 to 5.

Figure 3 - Total Tonnage by Category (2019)

Figure 3 breaks down the total tonnage of grape production from 2019 which equates to approximately 81,115 tonnes. Total grape production was then broken down into the following categories: • Wine (87%) • Icewine & Late Harvest (5%) • James & Juice (2%) • Homewine, Distilling & Sherry (1%) • Plateau Pricing (6%)

Figure 4 - Sales of Wine Grapes in Ontario (2019)

While total wine grape tonnage equaled 80,508 tonnes in 2019, Figure 4 separates the tonnage by hybrid and vinifera throughout the years 2016- 2019. During this period, hybrid grape production experienced a dip in 2017 with steady year-over-year growth since. Vinifera grape production experienced its dip in 2018 with a strong rebound in 2019.

Figure 5 - Vinifera Harvest in Ontario (2019)

Of the total wine grape tonnage produced in 2019, total vinifera harvest was 50,248 tonnes (representing 62%) as presented in Figure 5.

Figure 6 - European Hybrid Harvest in Ontario (2019)

Total European hybrid harvest was 30,260 tonnes in 2019.

Of the total wine grape tonnage produced in 2019, total hybrid grape harvest was 30,260 tonnes (representing 38%) as presented in Figure 6.

Figure 7 - Wine Grape Harvest in Ontario (2019)

Of the 30,260 tonnes of hybrid grapes harvested in 2019, 7,965 tonnes (26%) were from red grapes and the remaining 22,295 tonnes (74%) where from white grapes.

Of the 50,248 tonnes of vinifera grapes harvested in 2019, 20,406 tonnes (41%) were from red grapes and the remaining 29,842 tonnes (59%) where from white grapes.

Figure 8 - Average Price Per Tonne (Total Crop Value of All Grape Varieties) The average price per tonne (based on total crop value of all grape varieties) was $1,345 in 2019. This equates to an approximate increase of 5.5% over the previous year’s rate of $1,274 per tonne.

Over the past five (5) years, the 2015 harvest season reported the lowest average rate at $1,194 per tonne and the 2016 and 2019 harvest seasons both shared the highest reported average rate of $1,345 per tonne.

Figure 9 - The Top Varieties of Grapes in Production in Ontario (2019)

The top white varieties of grapes produced in 2019 included: Vidal, J.Riesling, Chardonnay, Pinot Gris, Sauvignon Blanc, Gewurztraminer, Geisenheim Hybrids and Niagara.

The top red varieties of grapes produced in 2019 included: Cabernet Franc, Merlot, Cabernet Sauvignon, Baco Noir, Pinot Noir, Gamay, Concord, and Chambourcin

With more than 180 estimated wineries spread throughout eastern, southern and southwestern Ontario, (representing approximately 17,000 acres of vines), Table 1 presents the number of growers with production within the province that are registered with the Grape Growers of Ontario. Important to note is that not all of these growers have their own winery and that the figures presented below represent grape growers which are registered with the Grape Growers of Ontario. The total number of grape growers showed signs of growth between 2015 and 2016 before experiencing a minor year-over-year decline between 2017 and 2019.

Table 1 - Number of Growers with Production Registered with Grape Growers of Ontario (Table Format)

District Region 2015 2016 2017 2018 2019 District 1 Niagara-on-the-Lake and Niagara Falls 186 190 188 184 180 St. Catharines, Fort Erie, Pelham, Port Colborne, District 2 35 36 34 31 31 Thorold, Wainfleet and Welland District 3 Town of Lincoln 148 147 145 150 142 Wellington and Hamilton, Grimsby and West District 4 18 18 15 14 9 Lincoln

Brant, Chatham-Kent, Essex, Elgin, Haldimand, District 5 23 37 38 30 30 Lambton, Middlesex, Norfolk and Oxford

Prince Edward County and all other geographic District 6 46 62 67 72 79 areas not included in Districts 1 to 5 TOTAL 456 490 487 481 471 Source 7 - (Grape Growers of Ontario, 2020) To dive deeper into understanding Table 1 above, Table 2 below breaks down the number of growers with production registered with the Grape Growers of Ontario by district between the years 2015 and 2019. In this particular format, we can wee that District 1 began to experience a slight year-over-year decline beginning 2017, the same for District 4. Districts 2 and 5 experienced declines with number of growers levelling out throughout 2018 and 2019. District 3 began experiencing declines in 2016, but saw an increased spike of registered growers in 2018 before a five-year low in 2019. The only district to see year-over-year growth in the number of growers was District 6 which represents Prince Edward County and all other geographic areas not included in Districts 1 to 5. Of particular interest (as it relates to this study) is to further dissect this District 6 so that a proper understanding can be had regarding the differences in growers in Prince Edward County versus all other geographic areas not includes in Districts 1 to 5. Understanding this will help provide insights into new and possibly emerging areas to concentrate grape production and may also yield insights into the level of activity taking place in Huron County. At the time of writing this report, we were unable to obtain that distinction within District 6.

Table 2 - Number of Growers with Production Registered with Grape Growers of Ontario (Chart Format)

Number of Growers with Production Registered with Grape Growers of Ontario 200 180 160 140 120 100 80 60 40 20 0 District 1 District 2 District 3 District 4 District 5 District 6

2015 2016 2017 2018 2019

Source 8 - (Grape Growers of Ontario, 2020)

Table 3 presents the volume of wine sales in Ontario. The table is split into the following categories:

1. Ontario VQA1 & Non-VQA/ICB Wine Sold in Ontario; 2. Imported Wine Sold in Ontario; and 3. Out-of-Province Sales in Ontario.

1 Vintners Quality Alliance, or VQA, is a regulatory and appellation system which guarantees the high quality and authenticity of origin for Canadian wines made under that system in British Columbia and Ontario (Wikipedia, 2020).

VQA Sales Outside Ontario are also denoted at the bottom of the table.

Table 3 - Wine Sales in Ontario (by Volume, ‘000s litres) (Table Format)

% Change District 2015 2016 2017 2018 2019 2018- 2019 VQA Sales in Ontario 16,442 17,929 17,889 19,350 19,800 2.3% Non-VQA Sales in Ontario 56,640 63,048 66,034 68,046 67,110 -1.4% Ontario VQA and Non-VQA/ICB Wine 73,082 80,977 83,923 87,396 86,910 -0.6% Sold in Ontario Imported Wine Sold in Ontario 108,565 111,481 112,954 115,808 112,754 -2.6% Out-of-Province Sales in Ontario 482 684 648 668 601 -10.0% Total Wine Sold in Ontario 182,129 193,142 197,525 203,872 200,265 -1.8% VQA Sales Outside Ontario 1,418 1,597 2,407 2,648 2,376 -10.3% Source 9 - (Grape Growers of Ontario, 2020)

To better understand the year-over-year trends in Table 3, Chart 1 visualizes the reported wine sales in Ontario between 2015 and 2019. Of particular note is that not one category experienced any major fluctuations during this period. VQA sales in Ontario saw year-over-year increase in sales throughout the entire study period. Non-VQA, imported wine and VQA sales outside of Ontario all experienced year-over-year increases in sales between 2015 and 2018, but each saw a marginal decline commencing in 2019. Lastly, out-of-province sales in Ontario experienced a marginal increase between 2015 and 2016, but had undergone fluctuating decreases since that time.

Chart 1 - Wine Sales in Ontario (by Volume, '000s litres) (Chart Format)

Wine Sales in Ontario (by Volume, '000s litres) (Chart Format) 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 2015 2016 2017 2018 2019

VQA Sales in Ontario** Non-VQA/ICB Sales in Ontario Imported Wine Sold in Ontario Out-of-Province Sales in Ontario VQA Sales Outside Ontario**

Source 9 - (Grape Growers of Ontario, 2020)

3.1.3 Growing Degree Days The Grape Growers of Ontario in their 2019 Annual Report indicated that the 2019 growing season was slightly cooler and wetter than average in all of the Designated Viticultural Areas across Ontario (Grape Growers of Ontario, 2020).

Growing season temperatures, and precipitation summaries for the Niagara Peninsula, Lake Erie North Shore and Prince Edward County appellations can be found in Table 4. For comparison purposes, Huron County is also included.

The winter was relatively mild, but March and April were colder than normal which extended the dormant period for grapevines. These cooler temperatures delayed bud break but reduced the risk of spring frost across all of Ontario’s grape growing regions. Growing degree days were lower than many previous vintages and most similar to 2017. However, precipitation records indicated higher than normal amounts of precipitation compared to normal for many areas in 2019. As expected, the 2019 weather conditions impacted the phenology, growth and yields of the vines which is partially captured in Table 5 and described below.

Table 4 - Summary of Growing Degree Days and total rainfall across Ontario’s Appellations Overall, Colchester had Growing Precipitation Appellation Region Degree the most heat units (mm) Days (1,508) and the least Niagara-on- amount of precipitation. Niagara Peninsula 1,419 657 the-Lake Niagara Peninsula Vineland 1,352 609 Niagara-on-the-Lake Lake Erie North Shore Colchester 1,508 537 had the next highest Prince Edward County Hillier 1,250 581 heat units but experienced the most precipitation due to a few major rainfall events occurring throughout the season, particularly in early August. Prince Edward County had the lowest amount of growing degree days with 1,250 growing degree days and less rainfall than the Niagara Peninsula.

Table 5 - Date of key phenological stages at select locations within the Niagara Peninsula (2019)

Bud The growing season got off to a Variety Location Bloom Veraison Break slower start due to these cooler Chardonnay St. Davids 14-May 26-Jun 28-Aug temperatures and bud break Riesling Niagara River 19-May 30-Jun 02-Sep occurred in first half of May for Merlot Creek Shores 14-May 01-Jul 04-Sep most cultivars. Temperatures were cooler and rainfall was Cabernet Franc Beamsville Bench 16-May 01-Jul 03-Sep higher than normal during the early part of the growing season in the Niagara Peninsula, Lake Erie North Shore and Prince Edward County. As a result, bloom was later than normal and flowering for many cultivars occurred in late June to the first week of July.

June brought normal summer temperatures and some drier weather, so conditions were ideal in many regions at bloom and for fruit set, with both sunny and dry conditions. This resulted in a short, but great flowering period which ultimately led to good fruit set and improved yields for many growers.

The month of July was warm and sunny with a few weeks of very hot weather over 30°C. However, some intermittent rainfall reduced any risk of drought stress and vine growth conditions were optimal during the summer months. August was also warm across all appellations in Ontario, but some very strong intermittent storms brought significant rainfall to some regions and unfortunately some hail to Niagara-on-the-Lake, but overall damage was very minimal. The weather was warm and drier after véraison and the start of grape maturation which was very beneficial. Fewer heat units, coupled with the late start resulted in a later start to véraison compared to other vintages over the past decade.

Conditions were average at the beginning of September and throughout harvest without any extremely warm temperatures. The cooler weather and lower humidity were ideal for cool climate cultivars to mature at a slower rate but avoid any bunch rot. October was fairly mild with few frost risks but there was some rainfall during this period. The mild late fall temperatures allowed for an extended growing season and harvest period that allowed growers to harvest into late November. Therefore, late season cultivars were able to have longer hang-time on the vine and achieve greater maturity even though the season was slow to start, cooler and wetter.

Overall grapes were generally harvested later than normal with slightly lower sugars, higher acidity and of high quality, particularly for classic cool climate cultivars such as Chardonnay, Pinot noir, Riesling and others (Grape Growers of Ontario, 2020).

3.1.4 Growth Potential and Trends 3.1.4.1 Sales Potential / Forecasts Through desktop research and feedback from stakeholder consultations, it is often difficult to understand the wine industry’s long-term growth potential beyond the year ahead, but trends on the other hand are providing unique insight and perspective into what winemakers can expect over the next few years. Those changes in trends will have an impact on grape growers. Chart 2 provides some historical (beginning in 2014) and short-term growth projections into 2020 of LCBO and Ontario Retail wine sales.

Chart 2 - Sales Now and the Road Ahead

Source 10 - (Mogk-Edwards, 2017)

Derived from LCBO’s 2018-2021 Strategic Plan, Table 6 presents LCBO’s forecasted sales targets of Ontario VQA Wine and International-Canadian Blends (ICB). Both categories indicate single-digit year-over-year growth into their 2020/21 fiscal year (with Ontario VQA Wines forecasting a double-digit increase in 2017/18).

Table 6 - LCBO Forecasted Sales Targets (2018-2021)

Sales $ 000,000’s 2016/17 2017/18 2018/19 2019/20 2020/21 Ontario VQA Wine $145.8 $161.2 $170.8 $185.8 $202.5 Yr/Yr % Change 5.3% 10.6% 6.0% 8.8% 8.9% ICB Wine $293.3 $306.2 $315.0 $328.1 $343.1 Yr/Yr % Change 6.4% 4.4% 2.9% 4.1% 4.6% Source 11 - (LCBO, 2018) 3.1.4.2 Changing Preferences: • Less is more. Customers are defining themselves less by how many things they own and more by how curated their lives are in terms of possessions and experiences (Kalish, 2017). • "Following" economy. Customers are seeking experiences and products that reflect the personal brand they promote on social media (Kalish, 2017).

3.1.4.3 Changing Formats: • "Retailization" of the world. The maker movement, the sharing economy, and other factors have made it increasingly difficult to define what a retail is and does. • On-demand shopping and fulfillment. Relevancy will be determined by the ability of retailers to meet the on-demand mindset of the modern customer (Kalish, 2017). 3.1.4.4 Changing Expectations • Exponential living. Exponential technologies are changing how we live and how we will shop (Kalish, 2017). 3.1.4.5 The Coronavirus Effect on Wine Consumption The key themes in global trends in wine for 2020 revolved around ‘The Four Rs’: Relationship, Retail, Repertoire and Responsibility (Arthur, 2020).

3.1.4.5.1 On-premise vs off-premise In January 2020, Wine Intelligence noted the rise of demand for eating out and experiences that are more inline with the Four Rs. This led to more frequent wine consumption in the on-premise section, increased spending, and trading up to more premium choices.

With the on-premise market wiped out in a number of markets under the coronavirus pandemic, this is evidently one of the biggest changes in the wine market. In contrast many off-premise retail channels are currently reporting ‘Christmas’ levels of sales, although these dramatic uplifts in retail sales are not anticipated to continue.

The inevitability of a global economic recession suggests that this switch to at-home consumption of wine will be both a medium and potentially long-term trend. However, the fundamental need to have a strong and memorable experience in out-of-home settings will continue - just not as frequently and most likely with a more restricted budget (Arthur, 2020).

3.1.4.5.2 Premiumization The wine industry had been enjoying an ongoing shift towards premiumization, with younger drinkers driving this trend. This has been driven by the ‘less but better’ mentality. This is another trend that may be turned on its head by coronavirus where the industry may have seen the end of the premiumization trend for now. The shock to the world economy is unprecedented with its short-term and long-term impact still being analysed. Economies will recover, but consumer confidence may take longer to come back. Value for money will be paramount and this will be particularly true for the category of wine, where price-points are distributed across such a broad range, delivering quality options at lower prices (Arthur, 2020).

3.1.4.5.3 Wine origin Another shift in consumption that could be emerging is a new emphasis on local wines. It is anticipated that a renewed focus on domestic and local wine in wine producing countries, reflecting national populations becoming more inwardly focused and protective. This will also

reflect consumers’ agendas to support their local businesses at a time of economic crisis. Potentially, there could be a consumer backlash against certain countries and regions, depending on how the pandemic is managed (Arthur, 2020). 3.1.4.6 Consumer Preferences Presented during the 2017 INSIGHTS Conference, Figure 11 presents Ontario’s customer favourite wines. Both the Chardonnay and the Vidal (identified in the category of White Blends) appear amongst this list of favourite grapes.

Figure 10 - Ontario Customer Favourites

Source 12 - (Mogk-Edwards, 2017)

Within Ontario customers no-so-favourite list of wines is the Cabernet Franc, as shown in Figure 11.

Figure 11 - Ontario Customer Not-So-Favourites

Source 13 - (Mogk-Edwards, 2017) Chart 3 summarizes customers preferences for Ontario wine with White and Red wines dominating the list with approximately $230 million and $170 million in annual sales respectively and experiencing a 6.9% and 9.6% increase in sales from the previous year.

Chart 3 - Customer Preferences for Ontario Wine

Source 14 - (Mogk-Edwards, 2017)

Chart 4 compares Ontario’s market share of LCBO wines to other globally produced wines. Ontario-produced wines represent 31% of all LCBO wine sales – ahead of wines produced from other globally renowned regions such as Italy, USA, Australia and France.

Chart 4 - LCBO Wine Market Share

Source 15 - (Mogk-Edwards, 2017)

3.1.5 Grape Prices For those considering investment into establishing a vineyard, Table 7 provides the latest market prices per tonne of grapes (as of July 27, 2020). Of particular interest is the Vidal grape, identified as Class 7a with a price of $681 per tonne; the Chardonnay grape, identified as Class 9b with a price of $1,593/tonne; and the Cabernet Franc grape, identified as Class 10c with a price of $1,852/tonne.

Table 7 - Grapes for Processing Prices (2020)

Class Variety $ per Tonne 1 Concord, Fredonia $518 (2018)2 2 Niagara, Wiley White $491 (2018)3 3 Elvira, Himrod, Sovereign Coronation $593 (2018)4 5 De Chaunac $760 5a Marechal Foch, Leon Millot $899 5b Baco Noir, Cascade, Castel, Chambourcin, Chancellor, GR7, Villard Noir $975

2 https://www.grapegrowersofontario.com/sites/default/files/2018%20Grape%20Prices.pdf 3 https://www.grapegrowersofontario.com/sites/default/files/2018%20Grape%20Prices.pdf 4 https://www.grapegrowersofontario.com/sites/default/files/2018%20Grape%20Prices.pdf

Class Variety $ per Tonne 5c Frontenac, Marquette $973 5d Experimental Red Hybrids, Florental, Landot, Red Amourensis, Varousset $741 B.S. 2846, Canada Muscat, Couderc 29935, New York Muscat, V61122, 6 $600 V64111 7 Aurore, J.S. 23-416, Siegfried Rebe, S.V. 172, S.V. 23-512, V50201, Verdelet $560 7a Seyval Blanc, Vidal $681 Geisenheim Hybrids, GM 311, GM 318, GM 322, GM 324-58, GM 323-58, 7b $588 Pollux 7c Experimental White Hybrids, Traminette, V65232, V71141, White Amourensis $518 9 J. Riesling $1,554 9 Riesling Plateau $1,265 9a Auxerrois, Bacchus, Kerner, Scheurebe, Welsch Riesling $1,368 9b Chardonnay Musque, Chardonnay $1,593 9b Chardonnay Plateau $1,270 9c Gewurztraminer $1,736 9d Pinot Gris, Pinot Blanc $1,832 9e Sauvignon Blanc, Semillon $1,792 9f Muscat Ottonel $1,463 9g Viognier $1,463 Aligote, Alsace Muscat, Chenin Blanc, Experimental White Vinifera, 9h Colombard, Gruner Veltliner, Melon de Bourgogne, Morio Muscat, Riesling $1,394 Traminer, Savignin 10 Gamay, Zweigeltrebe $1,418 10a Pinot Noir $2,147 10b Cabernet Sauvignon $2,075 10c Cabernet Franc $1,852 10d Merlot, Petit Verdot $2,092 10e Sirah, Shiraz, Syrah $2,425 10f Dornfelder $1,673 Blauberger, Experimental Red Vinifera, Limberger, Malbec, Nebbiolo, Petite 10g $1,501 Sirah, Pinot Meunier, Sangiovese, St. Laurent, Wildbacher Blau, Zinfandel Distilling5 $128 Sherry6 $306

5 Distillery refers to a part of the production/manufacturing process of converting grapes into grape products which include wine. Therefore, the distillery process can be contracted out at a rate of $128 per tonne. 6 Sherry is also a production process as part of the manufacturing process of sherry wines. The process is valued at $306 per tonne.

3.1.6 Staffing Costs and Job Descriptions When people think about careers in the wine industry, it’s often the winemaker or the sommelier that come to mind. But long before the sommelier can put their expert knowledge to use, helping you pick out the perfect wine for your meal, there is a chain of career professionals working to bring that grape from vineyard to table (Kidd, 2018).

Dr. Gabriel Balint, Chair of the Viticulture Technician Diploma Program at Okanagan College Penticton (British Columbia) said that, “if you talk to winemakers, they will say the wine is made in the vineyard and that if you don’t have good grapes, you can’t do anything in the winery” (Kidd, 2018).

There is a growing demand for skilled workers in this field. It breaks down into many facets: growing the grapes; managing the grapes; harvesting the grapes; and managing the whole procedure - everything from water to heat control to pruning. Expectations are very high, so graduates and other professionals are expected to take over right away, as a vineyard manager, an assistant or a viticulturist.

Talent attraction (in this industry) isn’t without its own issues and challenges. In a survey conducted for HortEducationBC and published in 2015, over 75 British Columbia grape growers, winemakers and industry stakeholders ranked the following issues as the top human resource issues challenging this sector (Humam Capital Strategies, 2012):

1. Inability to find qualified, trained employees; 2. Inability to attract employees; 3. Too few career pathways or development opportunities in sector; 4. Unable to retain employees/high turnover; 5. Competition for employees from other sectors; 6. Lack of general awareness of jobs and careers in this sector; 7. Absence of wine and grape sector-specific training; and 8. Other (please explain): • Cost to work is high (clothing and equipment is expensive), cost of living is going up, wages are not; • Transient labour, low wages necessary to keep costs low and remain competitive; • Low wages.

In a report released around the same time, Dr. Ali Hira of Simon Fraser University, identified a “lack of training opportunities” as one of nine “vulnerabilities” facing the industry. This lack is of concern since the Roslyn Kunin & Associates Inc. (RKA) and HortEducationBC studies show significant levels of growers and wineries that expect their Viticulture Technician (VT) levels to grow in the next five years (Humam Capital Strategies, 2012).

There are also a number of trends affecting VT human resources as identified in the RKA research, including (Humam Capital Strategies, 2012):

• Increasing safety regulations; • More technical work required (e.g. computerized records, irrigation, etc.); • Growing need for good people skills; • Increased mechanization of vineyard work; • Increased level of quality demanded by employers; • Multiple tasking, more diverse, more responsibility; • Increasing importance/spread of organic methods; • Working on the quality of grape and yield; • Ever-changing chemicals used; • Higher expectations from the marketplace; and, • A lack of standardized pay-scale or level of knowledge across the sector.

It was also identified that the following recruitment retention challenges and trends also exist (Humam Capital Strategies, 2012):

• Viticulture workers can be recruited by a combination of traditional methods including word of mouth, job advertising, receiving resumes, promotion from within, and through the Seasonal Agricultural Worker Program (SAWP); • Wages and working conditions and management quality are the most important retention/turnover factors; • Low wages make it difficult to retain workers – especially skilled ones – rote, physical nature and outside work (in hot/windy/rainy weather) make viticulture work unattractive to many workers; • Those who have been more successful in retaining workers have attempted to pay above average wages, provided accommodation and/or transportation, and allowed flexible work schedules.

To act as a baseline and to assist a prospective investor in understanding associated tasks and compensation levels with various types of possible positions, the following two (2) positions are summarized from Ontario-based grape growers currently recruiting to fulfill field positions. While these positions are more generic in nature to their respective titles, they again provide a baseline perspective by which to build upon.

Position: Vineyard Worker Position: General Farm Worker Hourly Rate: $14.25/hr ($28,500/yr) Hourly Rate: N/A Job Type: Seasonal Job Type: Seasonal Vineyard: Kuepfer Vineyards (Wellington, Vineyard: The Grange of Prince Edward ON) (Indeed.com) Estate Winery (Hillier, ON) (Indeed.com)

Position: Vineyard Worker Position: General Farm Worker Landscape and Horticulture Technicians Work Conditions and Physical and Specialists Specific Skills: Capabilities: • Brush collecting • Work under pressure • Clipping • Repetitive tasks • Deleafing • Handling heavy loads • Suckering • Physically demanding • Tying • Attention to detail • Weeding • Combination of sitting • Shoot positioning • Standing, walking, bending, crouching • Maintain and manage growth of vines, and kneeling vine canopy and grapes

Work Conditions and Physical Capabilities: Work Site Environment: • Repetitive tasks • Outdoors • Handling heavy loads • Wet/damp • Physically demanding • Noisy • Attention to detail • Hot • Hand-eye co-ordination • Combination of sitting, standing, Specific Skills: walking • Plant • Standing for extended periods • Cultivate and irrigate crops • Walking • Harvest crops • Bending, crouching, kneeling • Overtime required

Work Site Environment: • Outdoors • Wet/damp • Noisy • Dusty • Hot

Specific Skills - Field Crops: • Hoeing crops • Stone and/or wood picking

Specific Skills: • Operate and maintain farm machinery and equipment • Harvest crops

3.1.7 Alignment with Huron County There are a number of reasons which contribute to continued attention and focus on viticulture as a strategic fit for Huron County, including:

• Providing market access to otherwise marginalized producers; • Connecting grape growers directly to winemakers, resulting in fewer intermediaries; • Allowing for more of the money from transactions to remain in the community of production; • Shorter Supply Chains: o Fewer handlers o Less transportation • Satisfying market demand for any increases locally produced, niche grapes; and • The growing support for local food from all levels of government, and from farmers, winemakers, chefs, culinary tourists, small retailers and the general public. A short food chain helps keep family farms viable, supports small businesses in rural communities and provides consumers with healthy, nutritious, delicious food produced by people they know and trust.

In 2012, the Huron County Economic Development Services engaged the services of Dr. Anthony Shaw, an internationally renowned geographer from the Brock University Cool Climate Oenology and Viticulture Institute to provide an assessment of the climate in Huron County for which it could support viticulture.

Anthony Shaw’s climate study concluded that both viniferas and hybrids could grow in Huron County. Both varieties would produce wine that people would enjoy drinking. But the challenges of growing viniferas in Huron County’s climate are greater that those encountered in growing hybrids. To grow viniferas in this climate requires more energy. That’s energy from the sun because of their longer growing season, and heat energy to protect them from winter cold. Those inputs require time and money which can in turn, require vintners to put a high price on their wine simply to cover such costs. In Prince Edward County (for example), many growers and vintners have learned the hard way that hybrids are a better way to get started in grape growing and winemaking (Huron County Economic Development Services and Huron Business Development Corporation, 2012).

Wes Weins of VineTech Canada and Lloyd Schmidt, Founder of International Viticulture Services and who both participated in the 2012 study in Huron County strongly suggested that Huron County growers and vintners begin their grape-growing experience with hybrids. These grape varieties, particularly those developed specifically for cold climate viticulture, offer a greater likelihood of success at the start. They grow more reliably, and they require fewer inputs of time and money and equipment to get through the winter. It was noted that other professional viticulture consultants and oenologues concur (Huron County Economic Development Services and Huron Business Development Corporation, 2012). All parties indicated that it makes most sense to start with hybrids such as:

Hybrid Red Varietals: • Baco Noir, Chambourcin, Frontenac, Marechal Foch, and Marquette • Henry of Pelham Winery and Estate produce an excellent red Baco Noir • Malivoire Estate winery is using Marechal Foch successfully to make a very fine red wine • Ontario vintners in Prince Edward County and Grey County are finding a market for red wine made with Frontenac.

Hybrid White Varietals: • Frontenac Gris, L’Acadie Blanc, Seyval Blanc, and Vidal Blanc • Vidal is a white hybrid that is used for Ice Wine, Semi Dry Wines and Dry Wines by many wineries in Niagara region and elsewhere. • Seyval is less known as it is often used by large wineries in white blended wines • L’Acadie Blanc is successfully used in Nova Scotia and Quebec

Any red grapes from young vines can also be made into very nice bone-dry fruity rose or pressed ‘White’ and used in a sparkling blend.

Internationally renowned French viticulturist and winemaker, Pierre Marie Guillaume, who also participated in this study, indicated that based on soil and climate studies, reported that varieties such as Pinot Noir, Gamay Noir, Cabernet Franc, Riesling and Chardonnay would be suitable for commercial production within Huron County (Huron County Economic Development Services and Huron Business Development Corporation, 2012). For growers who want to experiment with growing viniferas, the following varieties were suggested:

Red Wine: White Wine: • Cabernet Franc • Chardonnay • Gamay • Gewurztraminer • Pinot Meunier • Riesling • Pinot Noir

3.1.8 Zoning Bylaws While zoning by-laws for a municipality (within Huron County) may be viewed at the local municipal level (Huron County), it is important to understand how general agriculture land use is defined, which, “means general farming and without limiting the generality of the foregoing shall include such uses as: the general cultivation of land and the associated production, conditioning, processing and storage of field crops, vegetables, fruit, horticultural crops and nursery stock and the selling of such produced on the premises, the breeding and care of livestock, fowl, fur-bearing animals and bees, and the selling of such stock or the product of such stock raised on the premises, and the management of forest, and the sale of forest products, including fuel wood, pulp wood, timber, Christmas trees, and maple products, and includes a farm dwelling and accessory buildings and uses.” (Huron County). Furthermore, the classification of “Agricultural Use, Limited” means the harvesting of field, bush, vine, forest, or tree crops grazing and trapping.

3.1.8.1 Zoning Classification: NATURAL ENVIRONNENT-LIMITED PROTECTION (NE2) No person within any Natural Environment - Limited Protection (NE2) Zone shall use any land, or erect, alter or use any building or structure for any purpose except in accordance with the following provisions: Agricultural uses, limited (bylaw 9.1.3 under Permitted Uses) (Municipality of Central Huron and County of Huron Planning and Development Department, 2020). 3.1.8.2 Zoning Classification: NATURAL ENVIRONMENT— SMALL HOLDING (NE3) No person within any Natural Environment- Small Holding (NE3) zone shall use any land, or erect, alter or use any building or structure for any purpose except in accordance with the following provisions: Agricultural use, limited (bylaw 10.2.3 under Accessory Uses) (Municipality of Central Huron and County of Huron Planning and Development Department, 2020).

At the time of preparing this report, efforts were made to identify a sample of properties for sale/lease that were zoned NE2 or NE3, but no such properties were currently available.

3.2 Supply Chain Description The wine industry (from producer to consumer) follows a common supply chain (as depicted in Figure 12). Wine originates from grape production in vineyards and once the yield has been harvested, if the grapes aren’t sold directly to wine makers (from the producers themselves), the grapes will ultimately reach the wine makers through one or more suppliers.

During the wine making (processing / manufacturing) phase, crushing the whole clusters of fresh ripe grapes is traditionally the next step in the wine making process. Sometimes, winemakers choose to allow fermentation to begin inside uncrushed whole grape clusters, allowing the natural weight of the grapes and the onset of fermentation to burst the skins of the grapes before pressing the uncrushed clusters. That said, once fermentation begins, it normally continues until all of the sugar is converted to alcohol and a dry wine is produced. Fermentation can require anywhere from ten days to a month or more. Once fermentation is completed, the clarification process begins. Winemakers have the option of racking or siphoning their wines from one tank or barrel to the next in the hope of leaving the precipitates and solids called pomace in the bottom of the fermenting tank. The final stage of the wine making process involves the aging and bottling of wine. After clarification, the winemaker has the choice of bottling a wine immediately, or to give a wine additional aging. Further aging can be done in the bottle, stainless steel or ceramic tanks, large wooden ovals, or small barrels, commonly called barriques (The International Wine of the Month Club).

Wine, which is now ready for consumption begins to make its way into the retail distribution system which often involves an extensive marketing campaign (comprised of various taste tests / samplings) and either being sold direct to retailers or channeled through one (or multiple) distributors and/or distribution networks.

Once the final product is on the shelf (albeit a grocery store, liquor store, gift shop, restaurant, etc.), it is now ready for purchase by the end user (customer) for consumption.

Figure 12 - Wine Industry Supply Chain

Source 16 - (Maumbe & Cheryl)

3.3 Vineyard Establishment

3.3.1 Site Selection Ontario has three (3) Vintner’s Quality Alliance (VQA) designated and legally demarcated wine regions or appellations, known as the Niagara Peninsula, Lake Erie North Shore and Prince Edward County. These growing regions are known for a wide range of international V. vinifera and French hybrids varieties. Emerging areas that are not legally designated nor are demarcated include Norfolk, Elgin, Huron Shores (which includes all of the Huron County wineries plus Alton Farms in Lambton County7), Grey, Durham and Northumberland Counties. Here, start-up vineyards growing a combination of cold-hardy V. vinifera and French hybrids are found in scattered locations with suitable micro-climatic and topographic conditions (Shaw, 2016).

7 A more detailed description of the more specific area within Huron County was provided by their Economic Development Department.

In the last decade, four (4) areas (Huron, Grey, Norfolk and Durham) have emerged as potential wine regions under limited plantings of cold-hardy V. vinifera varieties. In spite of a warming climate and an increase in the percentage of ice-free lake surface, frequent extreme winter temperatures still limit the location of viticulture to preferred areas that are generally located downwind, but within the moderating influence of the respective Lakes (Shaw, 2016).

3.3.2 Climatic Requirements In a previous study, the County had engaged the services of Dr. Anthony Shaw, an internationally renowned geographer from the Brock University Cool Climate Oenology and Viticulture Institute to provide an assessment of the climate (Huron County Economic Development Services and Huron Business Development Corporation, 2012). The goal of that study was to answer two (2) questions:

1. Does Huron County’s April to October growing season provide enough heat and light to support production of vitis vinifera grape? 2. Are Huron County’s winters too cold, and thus too damaging, to allow a commercially successful cultivation of vitis vinifera grapes?

Dr. Shaw analyzed the temperature records from two (2) weather stations in Huron County (Blyth and Exeter), and compared that temperature patterns with those from weather stations located in the two (2) other wine growing areas of Ontario, Vineland in Niagara Region and Harrow on the Lake Erie North Shore. He concluded that Huron County did indeed possess “a growing season with adequate number of growing degree days and a favourable Heliothermal Index that could support the commercial production of a range of cold-hardy, early to mid-season, Vitis vinifera varieties. According to Dr. Shaw, the elevation of the ridge as it slopes towards the Lake produces a meso climate with microclimates similar to those produced by the Niagara Escarpment.

The research reported that “the climatic suitability of this area for the successful cultivation of international varieties of Vitis vinifera grapes will be limited principally by the occurrence of damaging temperature of <-23°C degrees in the winter and by late spring and early fall frosts temperatures of <-2°C degrees”.

As for the potentially damaging effect of the winter, Dr. Shaw’s analysis revealed that Huron County’s winters were harsher than those in Niagara and Harrow, and that the likelihood of “potentially damaging temperatures” was greater in Huron than in Harrow or Vineland. He also noted that the Prince Edward County region had a more extreme winter climate than Huron County. While temperature records showed that a likelihood of 1.5 events of less than –23°C per year, Prince Edward County records averaged about 5 such events per year.

There are many potential sites for wine grapes, but these sites must be chosen very carefully. A minor difference in geography may represent a major difference in the local climate and will affect the ultimate viability of the vineyard (Ministry of Agriculture, Food and Rural Affairs, 2020). The

following represents a series of ideal climate conditions, including climate conditions to avoid, look and plan for. 3.3.2.1 Climate: • Look at the regional climate as well as local climate • Avoid extreme winter temperatures colder than -24°C • The frost free period should be 165 days minimum • Sunshine exceeding 1250 hours • Avoid frost pockets and low areas • Orient your rows N/S unless steep slopes require a different orientation 3.3.2.2 Avoid: • High frequency of extreme winter cold and/or killing frosts in spring and fall • High rainfall during bloom or harvest period • Poor water drainage, both surface and within the soil • Poor air drainage to escape frosts and reduce disease incidence • Full southern exposure to prevent early spring budbreak and southwest injury 3.3.2.3 Look for: • Good soil texture to ensure good soil water drainage • Good soil quality with organic matter and good nutrient availability • Good surface air and water drainage (3% slope desirable) 3.3.2.4 Plan: • Proper field preparation • Good perennial weed control before planting • Proper installation of subsurface or tile drainage • Proper match of rootstock with soil/climate/vigour potential of vineyard • Proper vine spacing and trellis design for variety and vigour potential of the vineyard • Proper variety for average growing season and cold risk of the site

3.3.3 Land Preparation and Soils In Huron County, there is a strip of land approximately eight (8) to eleven (11) kilometres inland from Lake Huron that for many years supported the growing of tender fruit. The proposed Huron Ridge grape-growing region extends 64 kilometres, from Port Albert in the north to Grand Bend in the south. Experts, who have been consulted on this strategic area report that this region offers many favourable sites for growing grapes (Huron County Economic Development Services and Huron Business Development Corporation, 2012).

In the past, soil testing has done along the Huron Ridge area. Soil samples were taken at five (5) locations in the proposed Huron Ridge wine region, including:

1. Region of Huron County with Nile; 2. Port Albert to the north; 3. Zurich to Saint Joseph in the south; 4. The ridge to the east; and 5. Lake Huron to the west.

A total of 24 samples were taken. The soil analysis was done by A & L Laboratories Canada Inc, of London, Ontario. The soil study indicated that the Huron Ridge soil has large amounts of calcium carbonate and other minerals. The geological formation of the soils in the proposed grape growing zone was composed mainly of sediment left by glaciers, resulting in a mosaic of diverse soils. This is similar to the geological conditioning found in Bourgogne, Medoc, Jura, Alsace, and Touraine (Loire Valley) in France.

The following represents a series of steps associated with soil preparation; drainage and irrigation; soil; and soil fertility in support of the site selection and preparation process (Ministry of Agriculture, Food and Rural Affairs, 2020). 3.3.3.1 Steps in Preparation • Land levelling, underdrainage • Take soil test, nematode test • Know herbicide history, control perennial weeds • Grow cover crops and add organic matter • Add lime, fertilizer if necessary 3.3.3.2 Drainage and Irrigation 3.3.3.2.1 Drainage Tile

• Critical during heavy rainfalls in spring and fall • Every row for heavy soils • Every other row for loam soils • Cross tiling across a vineyard - not common, but possible

3.3.3.2.2 Irrigation/Rainfall

• Critical for vineyard establishment • Critical for seed development in early July, and building of the hard green berry structure (same time as the next seasons bud development) • Critical for véraison in early August (sugar accumulation, colour change and rapid berry enlargement) • Beware - if irrigating, stop early enough for good fruit ripening for good wine quality and wood ripening for winter survival • About 2/3 of the annual rainfall occurs during the growing season (860mm) in most areas of Southern Ontario

3.3.3.3 Soil Fertility • Soil fertility is not as critical as soil structure • Can be addressed through soil and petiole analysis interpretation and proper fertilizer application • Excess nitrogen causes excess vigour, disturbing the delicate balance between yield, berry maturity and ultimately wine quality • The great balancing act - (climate, soil , vigour, cultivar, drainage, labour, etc.) must all be balanced for good wine quality 3.3.3.4 Soils Ideal soil conditions include coarse textured soils, moderate slope, well aerated, no restrictive soil layers.

• Allows development of a large root system (150-300 cm) to fully explore for water • Allows greater regularity in the water supply to the plant • Allows heavy rains to percolate quickly • Grape vines will tolerate a wide range of soils (but avoid shallow, poorly drained heavy clay soils

3.3.4 Variety Selection Table 8 presents a list of grape varieties (as suggested by the Ministry of Agriculture, Food and Rural Affairs) along with supporting comments about growing conditions, areas of caution and other insights which may be helpful for an investor considering the establishment of a vineyard in Huron County (Ministry of Agriculture, Food and Rural A ffairs, 2020).

Table 8 - Variety Selection

Variety Comments

311 GM* (white) H Riesling type flavour, ripens mid September

322 GM* (white) H Gewurztraminer flavour, ripens end of September

An extremely vigourous variety, does very well in heavy soil. On fertile soils Baco noir (red) H should be grafted on rootstock to reduce vigour. The fruit usually has high acidity but produces wines of good quality and good colour. Ripens mid September.

Variety with small clusters, small berries which are particularly attractive to birds. Foch (red) H Vines are vigorous, hardy and productive, makes excellent wine. Ripens mid September.

A traditional cultivar of Beaujolais. Vines are vigorous. Vines should be thinned Gamay (red) V to control crop level and to ensure good colour and maturity. Ripens mid September.

One of the best French Hybrids. Very vigorous should be grafted to contain Léon Millot (red) H vigour, high yielding. Ripens early September. Cold hardy.

A white French Hybrid, very good wine record. Vines are vigorous and Vidal (white) H productive, will suffer winter injury if too vigorous or overcropped. Ripens early October, suitable for late harvest or icewine production.

Variety makes an excellent wine. Will grow at mediocre site without problem. Zweigelt (red) V Ripens mid September.

Others: Cayuga White, St. Croix, St.Pepin, Frontenac, Seyval Blanc * = GM (Geisenheim) varieties

3.3.5 Winter Freeze Damage and Spring Frost Ratings for Grapes at Vineland Station, Ontario Table 9 denotes a ranking system (ranging from 1 to 10) where 1 is most susceptible and 10 is most tolerant (in the category of ‘winter freeze damage’) and a ranking system of 1 to 5) where 1 is most susceptible and 5 is most tolerant (in the category of ‘spring frost’). The ratings are based on best management practices with growers and research experience and are subject to fluctuations (Ministry of Agriculture, Food and Rural Affairs, 2020).

Table 9 - Winter Freeze Damage and Spring Frost Ratings for Grapes at Vineland Station, Ontario

Winter Freeze Damage Spring Frost Variety (rating 1-10*) (rating 1-5**) Baco Noir 8 1 Cabernet Franc 5 5 Cabernet Sauvignon 3 5 Chambourcin 7 5 Chardonnay 5 3 Concord 10 2 DeChaunac 9 3 Fredonia 10 2 Gamay Noir 5 5 Gewurztraminer 3 5 Geisenheim 312 8 5 Leon Millet 10 1 Marechal Foch 10 1 Merlot 2 4 Niagara 8 2 Petit Sirah 1 ? Pinot Gris 3 5 Pinot Noir 3 5 Riesling 5 5 Sauvignon Blanc 1 5 Seyval 8 4 Sovereign Coronation 9 3 Vidal 8 5 Zinfandel 1 ? * Ranked 1 to 10; 1 is most susceptible and 10 is most tolerant ** Ranked 1 to 5; 1 is most susceptible and 5 is most tolerant The ratings are based on best management practices with growers and research experience and are subject to fluctuations.

3.3.6 Training the Young Vine When establishing a vineyard, it is recommended to not plant too soon, nor too late - new vines need warm, moist soils - not cool and wet (may need to irrigate at planting if too dry). Several shoots should be allowed to break in order to reduce the number of shoots to 2 or 3 of the strongest ones. From there, growers will need to establish the trellis system and add the lowest wire. Bury a steel or bamboo vertical stake into the ground and fasten the top stake to the lowest wire and secure the developing shoots to the stake during the growing season. Continue to tie the developing shoots to the main stake until the lowest wire is reached and remove the secondary shoots as they break. Add a second and third wire to continue the shoot training until it reaches

the top. Continue to remove any secondary shoots from the ground up to 6 inches below the lowest wire. It will be important to the overall process to maintain good mechanical and/or hand weed control throughout the season.

3.3.7 Pruning and Training Systems The bulk of the previous season's growth is removed, leaving only four (4) to six (6) canes. These are reduced in length according to the vigour of the vines. Pruning is basically simple, but requires experience and judgement in the selection of the few canes that are to remain.

The canes selected should originate from the trunk or as close to it as possible. They should be of normal vigour and about pencil size, avoiding weak growth or very heavy bull canes.

In the Niagara Peninsula, several systems of training are followed, such as Pendelbogen, Umbrella Kniffen, and four- and six-cane Kniffen. Kniffen and Pendelbogen are the most common. The main advantage of following a particular system is that the work, particularly pruning and tying, is simplified and standardized.

Figure 13 - Four-Cane Kniffen (labrusca, hybrids) The six-cane Kniffen is trained to a central trunk with six arms (three left and three right). These arms produce canes each year of which one quality cane is selected, usually with 8 to 10 buds. The canes are tied each spring to support trellis wires at three heights from the ground, the lowest at 90 cm, the middle at 130 cm and the top at 170 cm. This results in six (6) parallel canes, two (2) canes at each level. The four-cane kniffen has one wire support and therefore have only four-canes. The canes are tied each spring to support trellis wires at two (2) heights from the ground, the lowest at 120 cm, and the top at 160 cm (Figure 13).

The six-cane Kniffen system is preferred by most growers because selection of fruiting canes and tying are generally easier.

Figure 14 - Pendelbogen (vinifera) Pendelbogen is simpler than the six-cane kniffen, with only two (2) canes coming from a shorter trunk at 90 cm above the ground. The two (2) high quality canes with 8 to 10 buds per cane are wrapped above the second wire 30 to 35 cm above the lower wire then tied to the lower wire. In addition, two (2) spurs with two (2) buds on each originating at the top of the trunk and also left for cane replacements for the following year (Figure 14). 3.3.7.1 Time of Pruning Pruning can begin any time after the first hard frost (-5°C or below) and should be finished before the vines start to "bleed" in the spring. The important consideration is that the vines be thoroughly dormant. Pruning should not be done on very cold days when canes are very brittle and those left may be injured when pulling out the brush. Prune labrusca types (Concord, Niagara) first starting as early as mid December and after the first cold temperatures, then prune the French hybrid vines in mid winter and the vinifera vines last in late winter or early spring, as they are more likely to suffer winter injury.

3.3.8 Cold Climate Maintenance Practices 3.3.8.1 "The Spare Parts Approach" • Utilize multiple trunks of different ages; and • Retain 2-3 times the normal buds, remove appropriate number in the spring.

3.3.8.2 "Other Practices" • Use hill vines to protect roots and graft union over the winter; • Use the hardiest cultivars; • Use appropriate vineyard floor management for enhancing fall acclimation; and • Use canopy management techniques to accentuate good sunlight exposure for wood and fruit ripening.

3.4 Implementation Cost The primary inputs into the grape-growing enterprise are knowledge, money, materials, manpower, and machinery (Huron County Economic Development Services and Huron Business Development Corporation, 2012). Knowledge is required to avoid costly errors that others have made. Money is required to pay for knowledge, land, materials, and labour.

The materials required include seedlings, trellising supplies, hand tools, and machinery. The cost of seedling will be affected by the choice of vine, which will in turn be affected by site considerations such as soil quality, drainage, exposure to sun, growing degree days, etc.

Trellising supplies will include posts, wires, and anchors. Machinery would include items such as a tractor, row cultivator, mower, herbicide sprayer, fertilizer sprayer, and a pickup truck. In the early days, special planting equipment may be needed.

Labour costs for the early years are significant. In a 2004 report, viticulture researchers reported that labour cost could range $3,000 $4,000 per acre for the first three (3) years of production. Such costs would also vary depending on the type of grape variety grown (i.e., hybrids or vitis vinifera). Lastly, estimates of the capital recovery period vary anywhere from seven to eleven years, again depending on the type of grape variety grown (i.e., hybrids or vitis vinifera).

3.4.1 Financial Analysis - Assumptive Model #1 The results of three (3) Break Even Yield to Cover Total Costs analyses are used to act as a baseline by which to understand the financial viability of a establishing a vineyard.

Each of these three (3) financial summaries were prepared by the Ministry of Agriculture, Food and Rural Affairs and were referenced in the 2019 Preliminary Report on the Establishment & Production Costs for Grapes in Ontario (Ministry of Agriculture, Food and Rural Affairs) and are based on the three (3) grape varieties introduced in section 2.3.1. 3.4.1.1 Cabernet Franc A more detailed review of the l ine items associated with the establ ishment and operational costs are presented below in the fifth year of production when the vineyard is considered to matured. At this time, Table 10 simply summarizes those figures associated with the preplant, planting, second, third and fourth years of production.

Table 10 - Total Establishment and Operating Costs

Production Year Total Establishment Cost Operation Costs (Hand and Machine) Preplant year $6,899 $325 Planting year $15,769 $2,037 Second year $5,837 $2,413 Third year $6,998 $3,283 Fourth year $7,713 $2,861 Total: $43,216 $10,919 Excludes Board fees, harvest costs and does not include revenues for years 3 and 4. Does not include land costs.

Table 11 details the annual costs of a mature vineyard which is typically considered to be in its fifth year of production.

Table 11 - Mature Vineyard: Annual cost

Cost per acre ($) Mature Vineyard: Annual cost Yield Yield Variable Costs 3.5 Tonne 5 Tonne Labour: Hand, 63 hrs $1,049 $1,049 Machine operator 30.9 hrs $809 $809 Fertilizer: Calcium ammonium nitrate, 37 kg $27 $27 Muriate of potash, 60 kg $41 $41 Insecticides $183 $183 Fungicides $610 $610 Herbicides $50 $50 Replacement vines 1% $56 $56 Cover crop seed $19 $19 Wind machine $389 $389 Machine costs: Repairs & maintenance $383 $383 Fuel $621 $621 Custom pruning $.48/vine $581 $581 Custom tying - $.24/vine $290 $290 Tying material $29 $29 Irrigation $287 $287 Bird control $212 $212 Custom harvest/delivery $347 $495 Board license and R&D fees ($21.45 per tonne) $75 $107 Crop insurance $222 $317 Consulting fees (soil, leaf, spray) $80 $80 Interest on operating capital $315 $328

Land rental Total Variable Costs: $6,675 $6,964 Fixed Costs Machine costs: Depreciation $514 $514 Interest on investment $179 $179 Other overhead $540 $540 Land ownership Measurable Fixed Costs $1,233 $1,233 Total Measurable Cost: $7,908 $8,197 Contribution Margin Gross Income ($1,852 per tonne) $6,482 $9,260 Total Variable Costs $6,675 $6,964 Contribution Margin (no land costs) -$193 $2,296

Table 12 details the annual costs of operation of a mature vineyard.

Table 12 - Mature Vineyard: Annual Operation Costs

Labour Labour Machine Fixed Total Mature Vineyard: Annual Operation Costs (hours) (Costs) (Costs*) (Costs) (Costs) Hand Suckering 9 $150 $150 Shoot thin, positioning, tucking 20 $333 $333 Leaf removal 13 $216 $216 Bunch thinning 17 $283 $283 Other operations 4 $67 $67 Total Hand Labour: 63 $1,049 $1,049 Machine Weed control: Spraying (3x) 2 $55 $57 $32 $144 Discing, cultivating (3.5x) 3 $73 $80 $57 $210 Pesticide spraying (12x) 4 $104 $163 $167 $434 Fertilizing (2x) 1 $26 $27 $17 $70 Sow cover crop 1 $18 $20 $16 $54 Mowing (5x) 4 $92 $97 $58 $247 Hilling up and removal 3 $79 $81 $50 $209 Subsoiling/aerating 1 $26 $27 $35 $88 Vineyard maintenance 5 $131 $146 $92 $370 Replacing vines 1 $26 $29 $18 $74 Hedging (2.5x) 3 $66 $108 $94 $268 Pre-pruning 1 $21 $37 $34 $92 Leaf removal (3.0x) 2 $52 $85 $69 $207

Brush shredding/flail 2 $39 $45 $33 $117 Total Machinery Operator: 31 $809 $1,004 $771 $2,583 *Includes maintenance, fuel and repair

Table 13 presents the Break Even Yield to Cover Total Costs of the Cabernet Franc grape and is calculated based on a sale price of $1,8528 per tonne. The results indicate that the breakeven yield to cover total annual costs is 5.7 tonnes / acre. Annualized establishment costs are included in these calculations, but it does not include land costs.

Table 13 - Break Even Yield to Cover Total Costs (Cabernet Franc)

Cabernet Franc Break Even Yield to Cover Total Costs

Annual costs excl. Total Revenue harvest Net Yield Harvesting Operating Annualized Costs ($1,852 / and Cash MT/ac costs interest Est. Costs with Est. tonne) operating Flow Costs interest costs

5 $9,260 $7,219 $602 $324 $2,203 $10,348 -$1,088

5.1 $9,445 $7,219 $614 $324 $2,203 $10,360 -$915 5.2 $9,630 $7,219 $626 $325 $2,203 $10,373 -$743 5.3 $9,816 $7,219 $638 $326 $2,203 $10,386 -$570 5.4 $10,001 $7,219 $650 $326 $2,203 $10,398 -$397 5.5 $10,186 $7,219 $662 $327 $2,203 $10,411 -$225 5.6 $10,371 $7,219 $675 $327 $2,203 $10,424 -$53 5.7 $10,556 $7,219 $687 $328 $2,203 $10,437 $119 5.8 $10,742 $7,219 $699 $329 $2,203 $10,450 $292 5.9 $10,927 $7,219 $711 $329 $2,203 $10,462 $465 6 $11,112 $7,219 $723 $330 $2,203 $10,475 $637 6.1 $11,297 $7,219 $735 $330 $2,203 $10,487 $810 6.2 $11,482 $7,219 $747 $331 $2,203 $10,500 $982 6.3 $11,668 $7,219 $759 $332 $2,203 $10,513 $1,155

8 https://www.grapegrowersofontario.com/sites/default/files/2020%20Grape%20Prices%20- %20July%2027-2020.pdf

3.4.1.2 Chardonnay A more detailed review of the line items associated with the establ ishment and operational costs are presented below in the fifth year of production when the vineyard is considered to matured. At this time, Table 14 simply summarizes those figures associated with the preplant, planting, second, third and fourth years of production.

Table 14 - Total Establishment and Operating Costs

Production Year Total Establishment Cost Operation Costs (Hand and Machine) Preplant year $6,899 $325 Planting year $15,770 $2,037 Second year $5,837 $2,413 Third year $6,890 $3,283 Fourth year $7,598 $2,061 Total $42,994 $10,119 Excludes Board fees, harvest costs and does not include revenues for years 3 and 4. Does not include land costs.

Table 15 details the annual costs of a mature vineyard which is typically considered to be in its fifth year of production.

Table 15 - Mature Vineyard: Annual cost

Cost per acre ($) Mature Vineyard: Annual cost Yield Yield Variable Costs 4 Tonne 6 Tonne Labour: Hand, 63.0 hrs $1,049 $1,049 Machine operator 30.9 hrs $809 $809 Fertilizer: Calcium ammonium nitrate, 37 kg $27 $27 Muriate of potash, 60 kg $42 $42 Insecticides $183 $183 Fungicides $610 $610 Herbicides $50 $50 Replacement vines 1% $56 $56 Cover crop seed $19 $19 Wind machine $389 $389 Machine costs: Repairs & maintenance $383 $383 Fuel $621 $621 Custom pruning $.48/vine $581 $581 Custom tying - $.24/vine $290 $290 Tying material $29 $29 Irrigation $287 $287

Bird control $105 $105 Custom harvest/delivery $396 $594 Board license and R&D fees ($19.90 per tonne) $80 $119 Crop insurance $222 $333 Consulting fees (soil, leaf, spray) $80 $80 Interest on operating capital $312 $330 Land rental Total Variable Costs: $6,620 $6,987 Fixed Costs Machine costs: Depreciation $514 $514 Interest on investment $179 $179 Other overhead $540 $540 Land ownership Measurable Fixed Costs $1,233 $1,233 Total Measurable Cost: $7,853 $8,220 Contribution Margin Gross Income ($1,593 per tonne) $6,372 $9,558 Total Variable Costs $6,620 $6,987 Contribution Margin (no land costs) -$248 $2,571

Table 16 details the annual costs of operation of a mature vineyard.

Table 16 - Mature Vineyard: Annual Operation Costs

Labour Labour Machine Fixed Total Mature Vineyard: Annual Operation Costs (hours) (Costs) (Costs*) (Costs) (Costs) Hand Suckering 9 $150 $150 Shoot thin, positioning, tucking 20 $333 $333 Leaf removal 13 $216 $216 Bunch thinning 17 $283 $283 Other operations 4 $67 $67 Total Hand Labour: 63 $1,049 $1,049 Machine Weed control: Spraying (3x) 2.1 $55 $57 $32 $144 Discing, cultivating (3.5x) 2.8 $73 $80 $57 $210 Pesticide spraying (12x) 4 $104 $163 $167 $434 Fertilizing (2x) 1 $26 $27 $17 $70 Sow cover crop 0.7 $18 $20 $16 $54 Mowing (5x) 3.5 $92 $97 $58 $247 Hilling up and removal 3 $79 $81 $50 $209

Subsoiling/aerating 1 $26 $27 $35 $88 Vineyard maintenance 5 $131 $146 $92 $370 Replacing vines 1 $26 $29 $18 $74 Hedging (2.5x) 2.5 $66 $108 $94 $268 Pre pruning 0.8 $21 $37 $34 $92 Leaf removal (2.0x) 2 $52 $85 $69 $207 Brush shredding/flail 1.5 $39 $45 $33 $117 Total Machinery Operator: 30.9 $809 $1,004 $771 $2,583 *Includes maintenance, fuel and repair

Table 17 presents the Break Even Yield to Cover Total Costs of the Chardonnay grape and is calculated based on a sale price of $1,5939 per tonne. The results indicate that the breakeven yield to cover total annual costs is 6.6 tonnes / acre. Annualized establishment costs are included in these calculations, but it does not include land costs.

Table 17 - Break Even Yield to Cover Total Costs (Chardonnay)

Chardonnay Break Even Yield to Cover Total Costs Annual costs excl. Total Revenue harvest Net Yield Harvesting Operating Annualized Costs ($1,593 / and Cash MT/ac costs interest Est. Costs with Est. tonne) operating Flow Costs interest costs 5.7 $9,080 $7,121 $678 $322 $2,173 $10,294 -$1,214 5.8 $9,239 $7,121 $690 $323 $2,173 $10,307 -$1,068 5.9 $9,399 $7,121 $702 $323 $2,173 $10,319 -$920 6 $9,558 $7,121 $713 $324 $2,173 $10,331 -$773 6.1 $9,717 $7,121 $725 $325 $2,173 $10,344 -$627 6.2 $9,877 $7,121 $737 $325 $2,173 $10,356 -$479 6.3 $10,036 $7,121 $749 $326 $2,173 $10,369 -$333 6.4 $10,195 $7,121 $761 $326 $2,173 $10,381 -$186 6.5 $10,355 $7,121 $773 $327 $2,173 $10,394 -$40 6.6 $10,514 $7,121 $785 $328 $2,173 $10,407 $107 6.7 $10,673 $7,121 $797 $328 $2,173 $10,419 $254 6.8 $10,832 $7,121 $809 $329 $2,173 $10,432 $400 6.9 $10,992 $7,121 $820 $329 $2,173 $10,443 $549 7 $11,151 $7,121 $832 $330 $2,173 $10,456 $695

9 https://www.grapegrowersofontario.com/sites/default/files/2020%20Grape%20Prices%20- %20July%2027-2020.pdf

3.4.1.3 Vidal A m ore detailed review of the l ine items associated with the establ ishment and operational costs are presented below in the fifth year of production when the vineyard is considered to matured. At this time, Table 18 simply summarizes those figures associated with the preplant, planting, second, third and fourth years of production.

Table 18 - Total Establishment and Operating Costs

Production Year Total Establishment Cost Operation Costs (Hand and Machine) Preplant year $6,881 $325 Planting year $14,534 $1,932 Second year $5,571 $2,311 Third year $5,777 $1,888 Fourth year $6,267 $1,868 Total: $39,030 $8,324

Table 19 details the annual costs of a mature vineyard which is typically considered to be in its fifth year of production.

Table 19 - Mature Vineyard: Annual cost

Cost per acre ($) Mature Vineyard: Annual cost Yield Yield Variable Costs 7.5 Tonne 9.5 Tonne Labour: Hand, 16.0 hrs $266 $266 Machine operator 24.0 hrs $629 $629 Fertilizer: Calcium ammonium nitrate, 99 kg $72 $72 Muriate of potash, 80 kg $55 $55 Insecticides $183 $183 Fungicides $610 $610 Herbicides $50 $50 Replacement vines 1% $45 $45 Cover crop seed $19 $19 Wind machine $389 $389 Machine costs: Repairs & maintenance $287 $287 Fuel $483 $483 Custom pruning $.50/vine $484 $484 Custom tying - $.28/vine $271 $271 Tying material $58 $58 Irrigation $287 $287 Bird control $105 $105 Custom harvest/delivery $743 $941

Board License and R&D Fees ($13.70 per tonne) $103 $130 Crop insurance $82 $104 Consulting fees (soil, leaf, spray) $62 $62 Interest on operating capital $261 $274 Land rental Total Variable Costs: $5,544 $5,804 Fixed Costs Machine costs: Depreciation $396 $396 Interest on investment $144 $144 Other overhead $540 $540 Land ownership Measurable Fixed Costs $1,080 $1,080 Total Measurable Cost: $6,624 $6,884 Contribution Margin Gross Income ($681 per tonne) $5,108 $6,470 Total Variable Costs $5,544 $5,804 Contribution Margin (no land costs) -$437 $666

Table 20 details the annual costs of operation of a mature vineyard.

Table 20 - Mature Vineyard: Annual Operation Costs

Labour Labour Machine Fixed Total Mature Vineyard: Annual Operation Costs (hours) (Costs) (Costs*) (Costs) (Costs) Hand Suckering 7 $117 $117 Shoot thin, positioning, tucking 5 $83 $83 Leaf removal 0 $0 $0 Bunch thinning 0 $0 $0 Other operations 4 $67 $67 Total Hand Labour: 16 $266 $266 Machine Weed control: Spraying (3x) 2.1 $55 $57 $32 $144 Discing, cultivating (3.5x) 2.8 $73 $80 $57 $210 Pesticide spraying (12x) 4 $105 $164 $169 $438 Fertilizing (2x) 1 $26 $27 $17 $70 Sow cover crop 0.6 $16 $17 $13 $46 Mowing (5x) 3.5 $92 $97 $58 $247 Hilling up and removal 0 $0 $0 $0 $0 Subsoiling/aerating 1 $26 $29 $35 $90 Vineyard maintenance 4 $105 $117 $74 $296

Replacing vines 1 $26 $29 $18 $74 Hedging (2.5x) 2.5 $66 $108 $94 $268 Leaf removal (0x) 0 $0 $0 $0 $0 Brush shredding/flail 1.5 $39 $45 $33 $117 Total Machinery Operator: 24 $629 $772 $599 $2,000

Table 21 presents the Break Even Yield to Cover Total Costs of the Vidal grape and is calculated based on a sale price of $68110 per tonne. The results indicate that the breakeven yield to cover total annual costs is 14.4 tonnes / acre. Annualized establishment costs are included in these calculations, but it does not include land costs.

Table 21 - Break Even Yield to Cover Total Costs (Vidal)

Vidal Break Even Yield to Cover Total Costs Annual Total costs excl. Revenue Costs Net Yield harvest and Harvesting Operating Annualized ($681 / with Cash MT/ac operating costs interest Est. Costs tonne) Est. Flow interest Costs costs 13 $8,853 $5,529 $1,465 $292 $2,281 $9,567 -$714 13.2 $8,989 $5,529 $1,488 $293 $2,281 $9,591 -$602 13.4 $9,125 $5,529 $1,510 $294 $2,281 $9,614 -$489 13.6 $9,262 $5,529 $1,533 $296 $2,281 $9,639 -$377 13.8 $9,398 $5,529 $1,555 $297 $2,281 $9,662 -$264 14 $9,534 $5,529 $1,578 $298 $2,281 $9,686 -$152 14.2 $9,670 $5,529 $1,600 $299 $2,281 $9,709 -$39 14.4 $9,806 $5,529 $1,623 $300 $2,281 $9,733 $73 14.6 $9,943 $5,529 $1,645 $301 $2,281 $9,756 $187 14.8 $10,079 $5,529 $1,668 $302 $2,281 $9,780 $299 15 $10,215 $5,529 $1,691 $303 $2,281 $9,804 $411 15.2 $10,351 $5,529 $1,713 $304 $2,281 $9,827 $524 15.4 $10,487 $5,529 $1,736 $306 $2,281 $9,852 $635 15.6 $10,624 $5,529 $1,758 $307 $2,281 $9,875 $749

10 https://www.grapegrowersofontario.com/sites/default/files/2020%20Grape%20Prices%20- %20July%2027-2020.pdf

3.5 Economic Impacts

3.5.1 Ontario Economic Impacts Ontario has a rich history of grape production, but the past 25 years have really seen an amazing evolution of the industry. Today, the grape growing industry contributes to Ontario's economy in diverse ways. It creates jobs and activities in manufacturing, processing, tourism and education. The grape production sector creates jobs in other sectors that provide it with goods and services, and it creates jobs in the sectors that use and merchandise its products. Grape growing and winemaking generate exports and tax revenues; together, the grape and wine industry has an enormous impact on the economy of Ontario (Grape Growers of Ontario).

For the first time in the last 30 years, grapes are the most valuable fruit in Ontario in terms of farm gate value. Grapes comprise 35% of the total farm value of Ontario commercial fruit crops. Over the last few years, grapes have been one of the few growth areas in Ontario agriculture, and represent increasing farm revenues. That increase can be directly attributed to the switch in acreage to higher-valued viniferas, which are in strong demand by Ontario wineries and consumers (Grape Growers of Ontario).

The majority of new plantings have been with vinifera varieties. Over the last several years, growers have invested more than $125 million in expanding vineyards to supply wineries’ demands for more premium grapes (Grape Growers of Ontario).

The Winery & Grower Alliance of Ontario presents the following industry activity which translates into the following economic impacts (Winery & Grower Alliance of Ontario, 2016):

• In 2015 the Ontario Wine Industry’s $4.4 billion economic impact is a significant driver to the Ontario economy and an increase of over $1 billion since 2011 • Ontario is the largest wine grape producing province in Canada, in terms of acreage, tonnage and wine grape sales • More than 18,000 jobs are created in Ontario as a result of the wine and grape Industry • In 2015, there were approximately 456 grape growers operating in Ontario with a combined acreage of 18,383 grape-bearing acres • In 2015, there were approximately 180 wineries in Ontario that sold almost 100 million bottles of Ontario wine • Approximately 2.4 million tourists visited Ontario wineries in 2015, up from 1.9 million in 2011 • For every bottle of Ontario wine produced in the province there is over $43 of economic impact generated • The Ontario wine and grape industry contributed to the Ontario economy business revenue of $2.97 billion, tax revenues of $522 million, and wages of $870 million • Over $755 million in federal and provincial taxes and liquor board mark-up was generated by the wine industry in Ontario in 2015. This is up from $602 million in 2011

• For every $1.00 spent on Canadian wine in Ontario, $3.95 in Gross Domestic Product (GDP) is generated across the province • Approximately $10.8 million in revenue was generated from vineyard development in Ontario in 2015

The Grape Growers of Ontario presents the following economic impacts (Grape Growers of Ontario):

• The wine industry generates $806 million in retail sales in Ontario (March 2016); • The grape and wine sector generates more than 18,000 jobs in Ontario; • $755 million in tax revenues and mark-ups; • $4.4 Billion total economic impact in Ontario; • The industry contributes $10,000 to the economy for every tonne of grapes grown and sold, compared to $700 for every tonne of oil produced from the oilsands; • As a tourism destination, Niagara attracts nearly 20 million visitors annually; more than 2.4 million people visit the province's wineries each year; and • Grape production enhances the environmental beauty of the province and preserves Ontario’s rich agricultural heritage (Grape Growers of Ontario).

The Wine Council of Ontario (in partnership with KPMG) released a report on the Economic Impact of VQA Wines in Ontario (KPMG: Study of the Ontario Economic Impact of Ontario VQA Wines). The report indicated the following economic impacts:

• Ontario benefited from $12.29 of economic impact per litre of VQA wine sold; • Volume of VQA wine sold at the LCBO has increased by nearly 5 million litres over the past 5 years; • VQA membership has increased from 94 members in 2007 to 123 members in 2011 and in 2020, now sits at 180 (VQA Ontario, 2020); • From 2007 to 2011, sale of VQA wine increased from $179.5 million to $268.5 million and in 2020, is reported to be $459,282,088 (VQA Ontario, 2020); • Growth in the industry has led to the creation of over 1,300 additional jobs in the last four years; and • The industry’s overall economic contribution in 2010 alone rose to $191 million.

3.5.2 Canadian Economic Impacts

The 2017 Economic Impact Report on the Wine and grape Industry in Canada presented the following (Frank, Rimerman + Co.):

• The Canadian wine industry production has an annual national economic impact of $9 billion; • An average bottle of wine sold in Canada carries a value of $36.54 in domestic economic impact generated in the country; • The Ontario wine and grape industry generates $4.4 billion in economic impact, British Columbia $2.8 billion, Quebec $1.1 billion and $218 million in Nova Scotia; • The wine and grape industry is responsible for more than 37,000 jobs in Canada from manufacturing, agriculture, tourism, transportation, research, restaurants and retail; • Wine-related tourism welcomes more than 3.7 million visitors each year, generating more than $1.5 billion annually in tourism revenue and employment; • The wine industry generates $1.7 billion in federal and provincial tax revenue and liquor board mark up; and • For every $1 spent on Canadian wine sold in Canada, $3.42 in Gross Domestic Product (GDP) is generated across the country.

3.6 Project Financing While a number of potential funding programs have been identified below, it is evident that both the provincial and federal levels of government see tremendous opportunity in supporting this burgeoning industry.

The following represents a series of funding programs that may be considered to support the financial requirements of establishing a vineyard. In consultation with OMAFRA and Agriculture and Agri-Food Canada, it was recommended that conversations are held between an interested investor and a regional/territory representative to ensure up-to-date information and eligibility requirements are met. In some instances, funds are primarily designed to assist existing operations/operators as opposed to establishing new operations. Furthermore, some funding programs which have a cost-sharing component, may require that investments meet a minimum threshold in order to meet eligibility requirements.

3.6.1 Productivity and Competitiveness11 Canadian Agricultural Partnership - Organizations and Collaborations Stream • Administered by the Agricultural Adaptation Council, a not-for-profit organization made up of agriculture, agri-food and rural organizations in Ontario. • Merit-based, cost-share funding target projects in three priority areas with research and innovation continuing to be important across all programs.

AgriCompetitiveness (Agriculture and Agri-Food Canada) • Aims to help the agricultural sector to leverage, coordinate and build on existing capacity, adapt to changing commercial and regulatory environments, seize new opportunities, etc.

Canadian Agricultural Partnership • The Partnership offers cost-share funding opportunities for processors and other agri- businesses to help modernize practices, equipment and operations.

Southwestern Ontario Development Fund • A grant program to help businesses create new jobs, and invest in new technologies, equipment or skills training for workers; also supports projects that will attract or retain investment in southwestern Ontario.

11 http://www.omafra.gov.on.ca/english/food/industry/funding-prog-index.htm

3.6.2 Business Development and Growth12 Food Safety and Traceability • OMAFRA has developed resources and e-learning courses that support the adoption of practices that help the food and beverage sector respond to heightened consumer awareness of food safety.

AgriInvest (Agriculture and Agri-Food Canada) • A government matched contribution savings account program to help producers address income declines and make investments to manage on-farm risks

Advance Payments Program (Agriculture and Agri-Food Canada) • Provides cash advances (i.e. loans) to producers to improve their cash flow and allow them greater marketing flexibility for their products during the production period

Canadian Agricultural Loans Act Program (Agriculture and Agri-Food Canada) • Loan guarantee program to increase the availability of loans to existing and new (less than 6 years of farming) farmers and agricultural co-operatives to establish, improve, and develop their farm businesses

3.6.3 Market Access13 AgriMarketing Program: Small and Medium-sized (Agriculture and Agri-Food Canada) • Aims to increase and diversify exports to international markets and seize domestic market opportunities • This program is for SMEs in agriculture, agri-food, and fish and seafood sectors with fewer than 250 employees and annual sales not exceeding $50M.

Rapid Response to Business Opportunities Program • This program is designed to provide benefit to the "business of agriculture" in Ontario.

3.6.4 Protection and Insurance AgriInsurance (Agriculture and Agri-Food Canada) • Provides protection against production and quality losses due to natural hazards

AgriStability (Agriculture and Agri-Food Canada) • Protects producers against large declines in farming income for reasons such as production loss, increased costs and market conditions

12 http://www.omafra.gov.on.ca/english/food/industry/funding-prog-index.htm 13 http://www.omafra.gov.on.ca/english/food/industry/funding-prog-index.htm

3.6.5 Research and Development14 Industrial Research Assistance Program • Financial support and consulting services to Canadian companies in all industry sectors to encourage innovative products, processes and technology.

OMAFRA–University of Guelph Research Partnership • This research program includes seven themes. The Principal Investigator must be a faculty staff member from the University of Guelph and are encouraged to partner with industry.

Ontario Business Research Institute Tax Credit • Eligible corporations can claim a 20% refundable tax credit for qualified expenditures on scientific research and experimental development work performed in Ontario.

Rapid Response to Research Needs Program • Funding up to $20,000 to help solve small research hurdles or product standards testing.

Scientific Research and Experimental Development Seminars • Learn about the SR&ED incentives in Ontario. Attend a joint seminar offered by the Canada Revenue Agency (CRA) and the Ontario Ministry of Finance to learn about the program, eligibility criteria, and eligible expenses.

Scientific Research and Experimental Development Tax Incentive Program • A tax incentive program to encourage Canadian businesses of all sizes and in all sectors to conduct research and development in Canada that will lead to new, improved, or technologically advanced products or processes.

3.6.6 Workforce/Labour15 Canada Ontario Jobs Grant - Employment Ontario • Funding provided by the Government of Canada through the Canada Job Grant. Programs delivered by the Government of Ontario.

Career Edge • Career Edge is a self-sustaining social enterprise that connects leading Canadian employers with diverse, qualified talent through paid internships.

14 http://www.omafra.gov.on.ca/english/food/industry/funding-prog-index.htm 15 http://www.omafra.gov.on.ca/english/food/industry/funding-prog-index.htm

MITACS Accelerate • Solve business challenges with research expertise, matching funds, and one-to-one support from Mitacs.

Sector Initiative Fund • A program designed to help industry sectors and organizations to develop training programs, materials and standards for their workforces.

4. Conclusion

Based on market forecasts, Ontario’s position and reputation of wine production, the assessment of Huron County as a favourable growing region of grapes, viticulture provides a viable business case which should be highly considered by viticulturalist, a local farmer and/or a prospective investor interested in pursuing this type of unique agricultural opportunity within Huron County. While the wine industry continue to evolve, there is a large segment of the population which is looking for consistency and commitment to quality. Viticulturalists are employing new growth strategies and benefiting form the introduction of new technologies and best practices to ensure consistently high annual yields resulting in favourable returns on their investment. Notwithstanding that there are inherent challenges and associated risks (including disease and climate change), many of these same obstacles are a reality for which farmers face in the majority of other outdoor crops. There is also much research being conducted on minimizing these impacts on grape production and there is a strong network with producers, organizations and associations that are designed and focused on facilitating information and knowledge sharing. Again, this business case is designed to act as a baseline by which to help move forward the interest and intentions of an interested party in pursuing grape production within the County and there are numerous organizations, agencies and other resources available to provide up-to-date information to help any project along ranging from the small scale producer to the more commercial-sized operations.

5. Recommended Next Steps

In the context of building upon the existing level of grape production within Huron County, the Economic Development Department should use this opportunity to reengage with all of its locally- based grape producers to discuss the results of this report and to gain an updated perspective regarding their level of interest to increasing capacity while understanding what obstacles and challenges are currently preventing them from doing do. The Huron County Economic Development Department should also strengthen ties with the Grape Growers of Ontario and regularly present them with updated information associated with available and suitable lots (for sale/lease), including an updated community profile and other promotional material which the association could use to entice and direct investment interest to the County.

At the time of preparing this report, landowners are seeing unprecedented demand for land. As a result, land values are at a premium and landowners are cashing in. Consequently, this is affecting small-scale grape producers who are wanting to expand operations but can’t justify the investment on account of the exceedingly high asking prices of land. From the County’s perspective, there should also be internal discussions to determine if plots of county-owned lands (which have ideal soil and climatic conditions) could be either leased or sold under an agreed-upon condition that they are utilized solely for grape production. For the interested viticulturalist, local farmer and/or a prospective investor, the following four-point plan is proposed as a series of next steps stemming from this report.

5.1 Four Point Plan There are many components to investigate prior to developing a comprehensive business plan in order to support any new enterprise or to plant any new crop. All four (4) of the following are critical to success (Ministry of Agriculture, Food and Rural Affairs, 2020):

5.1.1 Marketing Selling ones’ crop is never guaranteed, but it is better to plant what is in demand rather than what a grower/investor simply prefers. It is also recommended to hold discussions with a prospective buyer and even secure contracts before planting should be part of an investors plan.

5.1.2 Human Resources Who is going to do the work in the vineyard? Will you be able to find skilled help? Can you predict your workload within the season and over the first few years and match this with the labour that is available? These are only a few questions that an investor will need to address prior to planting.

5.1.3 Financing Financing will need to be secured, not only for the year of planting but the following years while waiting for the vine to bear full crops. The report entitled, “Establishment and Production Costs for Grapes in Ontario - 2019 Economic Report” is a good resource for beginning growers to project their cash flow needs.

5.1.4 Production Grape production involves several components after the vineyard is established; training, trellises, pruning, tying, canopy and crop management, pest management and other cultural practices. Taking time to understand these components, when they are necessary to be done, the number of people required to undertake them, and associated equipment should all be considered and planned out in advance.

6. Bibliography

Arthur, R. (2020, April 7). How will coronavirus affect wine consumption? ‘We may have seen the end of the premiumization trend for now’. Retrieved from https://www.beveragedaily.com/Article/2020/04/07/How-coronavirus-is-shifting- consumer-trends-in-the-wine-industry Crosariol, B. (2012, April 3). When it comes to grape vines, old is gold. Retrieved from https://www.theglobeandmail.com/life/food-and-wine/wine/when-it-comes-to-grapevines-old-is- gold/article4097539/#:~:text=%22The%20optimum%20winemaking%20life%20of,of%20t he%20oldest%20in%20Canada. Frank, Rimerman + Co. (n.d.). Canada’s Wine Economy – Ripe Robust Remarkable. (W. G. Canada, Compiler) Retrieved from https://www.winegrowerscanada.ca/our- industry/economic-impact/ Grape Growers of Ontario. (2020, January 31). 72nd Annual Report. Grape Growers of Ontario. (2020, July 27). Grapes for Processing Prices 2020. Retrieved from https://www.grapegrowersofontario.com/sites/default/files/2020%20Grape%20Prices%2 0-%20July%2027-2020.pdf Grape Growers of Ontario. (n.d.). Grape Facts. Retrieved from https://www.grapegrowersofontario.com/grape_facts Grape Growers of Ontario. (n.d.). Grapes for Wine. Retrieved from https://www.grapegrowersofontario.com/grapes_for_wine Grape Growers of Ontario. (n.d.). Industry Facts. Retrieved from https://www.grapegrowersofontario.com/62 Grape Growers of Ontario. (n.d.). Ontario's Grape & Wine Industry. Retrieved from https://www.grapegrowersofontario.com/ontarios-grape-and-wine- industry#:~:text=Today%2C%20there%20are%20more%20than,eastern%2C%20southe rn%20and%20southwestern%20Ontario. Grape Growers of Ontario. (n.d.). What We Grow. Retrieved from https://www.grapegrowersofontario.com/what_we_grow Humam Capital Strategies. (2012, September). A Human Resource Strategy and Training Options for the British Columbia Viticulture Industry. Huron County. (2011, December). Take Action for Sustainable Huron: Appendix A Sustainability Tool-Box. Huron County Economic Development Services and Huron Business Development Corporation. (2012, February 2). Viticulture in Huron County: An Introduction for Investors. Huron County. (n.d.). Zoning By-Laws. Retrieved from https://www.huroncounty.ca/plandev/county-official-plan/zoning-by-laws/ Indeed.com. (n.d.). General Farm Worker. Retrieved from https://ca.indeed.com/jobs?q=viticulture&l&vjk=bf296279d000a3ec&advn=81081267626 66155

Indeed.com. (n.d.). Vineyard Worder. Retrieved from https://ca.indeed.com/jobs?q=viticulture&l= Kalish, I. (2017). Global Powers of Retails 2017: The Art and Science of Customers. Kidd, S. (2018, March 6). Growing demand for skilled workers in the wine industry. Retrieved from https://www.pentictonwesternnews.com/business/growing-demand-for-skilled-workers- in-the-wine-industry/ KPMG: Study of the Ontario Economic Impact of Ontario VQA Wines. (n.d.). (G. G. Ontario, Compiler) Retrieved from http://www.grapegrowersofontario.com/node/302 LCBO. (2018). LCBO Strategic Plan 2018-2021. Maumbe, B., & Cheryl, B. (n.d.). Entrepreneurial and Buyer-Driven Local Wine Supply Chains: Case Study of Acres of Land Winery in Kentucky. Ministry of Agriculture, Food and Rural Affairs. (2020, August 28). Wine Grape Production Outside Traditional Areas in Ontario. Retrieved from http://www.omafra.gov.on.ca/english/crops/facts/info_grapeprod.htm Ministry of Agriculture, Food and Rural Affairs. (n.d.). Establishment & Production Costs for Grapes in Ontario 2019 Preliminary Report. Mogk-Edwards, S. (2017, March 7). Wine Trends & Sales at LCBO. Municipality of Central Huron and County of Huron Planning and Development Department. (2020, July). Zoning By-law. Retrieved from https://www.centralhuron.ca/en/business- and-development/resources/Documents/CHu-ZBL-Consolidated---July-2020.pdf Neumann, P., & Matzarakis , A. (2013, February 12). Estimation of wine characteristics using a modified Heliothermal Index in Baden-Württemberg, SW Germany. Retrieved from https://link.springer.com/article/10.1007/s00484-013-0637-z Shaw, T. B. (2016, September 15). Climate Change and the Evolution of the Ontario Cool Climate Wine Regions in Canada. (B. U. Department of Geography & Cool Climate Oenology and Viticulture Institute, Compiler) The International Wine of the Month Club. (n.d.). Learn The 5 Steps of The Wine Making Process. Retrieved from https://www.winemonthclub.com/the-wine-making- process#:~:text=There%20are%20five%20basic%20stages,and%20then%20aging%20a nd%20bottling. VQA Ontario. (2020). 2020 Annual Report: Vintners Quality Alliance Ontario. Retrieved from https://www.vqaontario.ca/AboutVQA/AnnualReports/2020/Chair Wikipedia. (2020). Vintners Quality Alliance. Retrieved from https://en.wikipedia.org/wiki/Vintners_Quality_Alliance#:~:text=Vintners%20Quality%20A lliance%2C%20or%20VQA,in%20British%20Columbia%20and%20Ontario.&text=In%20 addition%2C%20there%20are%20other%20classifications%20of%20wine%20in%20Ca nada. Wine Country Ontario. (2015). Our Story. Wine Folly. (2020, May 15). Discover the Lifecycle of a Wine Grapevine. Retrieved from https://winefolly.com/deep-dive/lifecycle-of-a-wine-grapevine/ Winery & Grower Alliance of Ontario. (2016). Ontario Wine and Grape Industry Fact Sheet. Zhang, B. (2018, December 9). The Environmental, Social and Economic Impacts of Winemaking. Retrieved from https://owlcation.com/social-sciences/the-environmental-social-and- economic-impacts-of-winemaking

61 This page has been intentionally left blank.