Competition with NLC-owned Rock Spirits Unfair, Pasadena Brewery Says |  CBC News

Competition with NLC-owned Rock Spirits Unfair, Pasadena Brewery Says | CBC News

Newfoundland’s west coast brewer says it’s at a disadvantage because the county-owned brewer’s commission prefers their canned products.

Jim MacDonald, owner of Western Newfoundland Brewing Co. Now, it’s time for the county government to reconsider how Rock Spirits — a distillery wholly owned by the Newfoundland and Labrador Liquor Commission — affects local businesses like his.

“They generally put the local producers in the corner together, basically as one company, while pushing their own products to the fore,” MacDonald said, referring to NLC’s promotion of Rock Spirits products like Newfoundland Screech and Old Sam.

MacDonald said competition has become more intense in recent years, after NLC purchased canning equipment to make “ready-to-drink” products, or RTDs. While the Liquor Commission said canning would be available for craft brewers to use, many country breweries felt it did not make sense to ship beer to St. John in a tanker truck, so they did not take advantage of the service.

Instead, canning equipment was used by Lambs producers to make Lamb’s Sociable Spiced Rum Punch and also by Rock Spirits to produce four canned brews, including Screech Punch.

MacDonald said these NLC-owned products compete squarely with local breweries — for both sales and shelf space.

Bruce Keating, CEO and president of Newfoundland and Labrador Liquor, says NLC’s products are not affecting operations like McDonald’s. (Eddie Kennedy/CBC)

NLC President Bruce Keating said he appreciates MacDonald’s concerns, but doesn’t see it that way.

“Rock Spirits has been a part of NLC and what we’ve been doing as an organization for 65 years,” he said. “What we do in the RTD category has no material impact on the success or non-success of Mr. McDonald’s products.”

Keating said the NLC conference saw an increase in demand for packaged products, driven by a wave of interest in beverages such as coolers, cooler, and craft beer. He said there are about 250 products in the ready-to-drink product category, and Rock Spirits produces only four.

But MacDonald said Rock Spirits is able to produce, stock and market these products at a scale and price other breweries cannot match. A six-pack of Screech Punch, for example, is on sale for $18.77. Similar products, even from major producers like White Claw or Mike’s Hard, sell for more than $20 per six-pack.

“They are able to produce it very cheaply,” MacDonald said. “Because they are able to buy all of their inventory in bulk, it’s cheaper to produce everything than Rock Spirits. Not to mention it’s government owned. They can float themselves as they like.”

The Rock Spirits canning facility began operating in 2020. (Cecil Heyer/CBC)

It’s exceptionally rare for a government to own a distillery, but Keating said the Rock Spirits were very beneficial to the boycott. More than 80 percent of its products are exported and sold in 32 countries around the world. However, all of their canned products are sold locally. A survey of the NLC’s website shows there are thousands of them available, and they are in every liquor store across the county.

While MacDonald said NLC “prioritizes its products” when it comes to shelving space, Keating said size has a lot to do with how products are promoted and positioned within stores. He said the craft industry has shown explosive growth in recent years, but most breweries still make relatively small quantities.

“Given the scale of production, it creates challenges in a timely manner in terms of our ability to source and deliver this product to our customers on a consistent and reliable basis,” he said.

Keating admitted that craft beer could be better placed in many stores, and discussions are underway about “refurbishing” the refrigerated sections to give more prominence to the craft beer drink.

Read more from CBC Newfoundland and Labrador

2022-06-06 19:00:00

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