Raising a glass to a reduction in the to provincial craft beer mark-up Friday in Kelowna were (left to right) Jack Clark of Freddy's Brew Pub

Kelowna beer-makers welcome break for brewers

Province lowers the mark-up it charges small regional breweries to sell their beer in B.C.

Kelowna-area breweries of all sizes are welcoming the province’s decision to scale back the mark-up it charges small and regional beer makers in this province for the right to sell their suds in B.C.

On Friday in Burnaby, Small Business Minister Coralee Oakes announced the Liquor Distribution Branch—for which her ministry has responsibility — will reduce the mark-up by 25 per cent per litre, a move expected to save micro and craft brewers a total of $10 million.

“It’s fantastic news,” said Chris Dedinsky of Kelowna’s Kettle River Brewing Company.

He said as a fairly new, small brewery, money is tight and the reduction in the mark-up would be a huge benefit for his business.

Speaking at a Kelowna version of the announcement with local MLAs Norm Letnick (Kelowna-Lake Country) and Steve Thomson (Kelowna-Mission), Dedinsky was joined by representatives of the larger local beer maker Tree Brewing, and small-batch brewer Freddy’s Brew Pub.

Both Tod Melnyk of Tree Brewing and Freddy’s brewmaster Jack Clark, echoed Dedinsky’s comments, saying the reduction in how much they have to pay the government will result in more investment in their local businesses.

According to Letnick, B.C.’s agriculture minister, the craft and micro brew business in this province is growing quickly, with the number of small regional breweries more than doubling to 110 in 2015 from just 54 five years ago.

“And we expect to see as many as 20 more this year alone,” he said.

Because of that, Letnick said the hop-growing business in B.C. is booming in several regions and drinkers just have to sample some of the unique local beers to get an idea of why that is.

“They are making some really good beers,” he said lifting a glass to celebrate the news.

The mark-up change will go into effect July 3, said Oakes, meaning craft breweries will have increased financial capacity to grow and expand.

She said the changes further improve mark-up rates for craft beer that were announced last year when the government introduced a new wholesale pricing model and will enable craft breweries to create jobs while increasing the availability of high quality, made-in-B.C. products.

The government says  B.C. is continuing to grow its reputation as the craft beer capital of Canada, with craft brewers in every corner of the  province benefiting from change.

In the last year alone, there has been a 35 per cent increase in the amount of craft beer produced in B.C.

and Letnick said it’s not just B.C. hop growers who are benefiting from the growth in craft beer production. He said other provincially grown agricultural products are also used in making beer and  that is contributing to  the grow of sales of B.C. agri-foods. Last year B.C. agri-food sales topped $12 billion, he said.

The latest move to help small regional breweries is one of 41 recommendations of a provincial liquor policy review that took three years to complete. The review contained a total of 71 recommendations.