Richmond, British Columbia—Lulu Island Winery, home of China House during the 2010 Winter Olympics, was the setting last week for an announcement of $160,000 (all figures Canadian) in federal funding to help Canada’s wineries break into international markets.

Canada is a minor supplier to the world’s wine cellars, but export markets have been important in raising the country’s profile as well as diversifying markets for vintners. Canada exported $40.8 million worth of wine in 2011.

The new funding, made as part of the federal government’s $88 million Agri Marketing Program, will support further diversification into export markets.

“We wouldn’t have the resources to do this kind of work in those export markets, because the export of B.C. wine is so small at this juncture,” Miles Prodan, executive director of the B.C. Wine Institute, told Wines & Vines.

B.C. exported approximately $5.9 million worth of wine in 2011, a fraction of the $26.4 million of wine that Ontario shipped overseas the same year.

“The AMP money really allows us...to start laying the groundwork and start making the relationships,” Prodan said.

Administered by the Canadian Vintners’ Association, the grant follows a $190,620 grant made under the same program in 2011. The funding is matched by the wine industries in British Columbia, Ontario and Nova Scotia, which also advise on the use of the funds.

Prodan said the B.C. industry is contributing approximately $50,000 to the program. The cash will be used to facilitate visits to B.C. by trade representatives and media from Hong Kong, New York and the United Kingdom.

Canada’s biggest trading partner, the United States, is also the primary destination for its wine, but Asia is rapidly gaining ground, in line with its ascendance among Canada’s trading partners.

Since the recession of 2008-09, the Asia Pacific region has become a significant destination for Canadian exports. China is Canada’s largest export market after the U.S., and the past year saw Asia edge out the U.S. as the largest trading partner of B.C. The dollar value of Canada’s wine shipments to Asia have more than doubled post-recession and now rival those to the U.S.

Exports for Asia
Canada’s biggest trading partners in Asia—the so-called Asia Pacific 10—bought $18.2 million worth of Canadian wine in 2011, a fraction behind the $18.4 million of wine that Canada shipped to the U.S. the same year.

Hong Kong is of particular interest to the B.C. industry, Prodan said. “Other wineries may be exporting to other markets like China, India, the U.K. and the rest of it, but as an association we’ve identified Hong Kong.”

Hong Kong eliminated duties on wine imports in 2008 with the aim of becoming a hub for Asia’s wine trade. It also has no labelling requirements, making it a good launching pad for wineries seeking opportunities in Asia.

“There’s other B.C. wineries exporting to Asia—China, Korea and the rest of it—but as an association with the AMP funding we’ve focused on Hong Kong,” Prodan said. “(It) really allows...for some of the smaller wineries, under the umbrella of the association, to look at some of these other markets.”

B.C. isn’t alone in eyeing export markets.

Washington state exports
Washington state has also seen increasing exports to Asia, with a voluntary survey of Washington State Wine Commission members indicating that shipments to mainland China doubled between the years during the year ended June 30, 2012.

Mainland China now accounts for 8% of Washington state wine exports (18,176 cases)—fourth after Canada, the United Kingdom and Japan.

WSWC figures peg the total volume of Washington state wine exports at 241,364 cases worth approximately $20 million (USD.)