Alcohol sales to surge during holiday season
Patrons line up to get into an LCBO outlet as others leave after stocking up with their New Years Eve beverages in Mississauga, Ont., December 31, 2007. THE CANADIAN PRESS/J.P. Moczulski
Canadians are expected to raise their glasses many times this holiday season with alcohol sales on track to set a record high this month and also for 2012, says a new report.
The average Canadian adult will spend more than $85 on booze in December, which translates to about one bottle of spirits, three bottles of wine and 27 bottles of beer, according to the BMO Holiday "Spirits" report.
"If the strength we've seen so far persists through the holiday season, then the industry is on track for a very strong and probably a record year," BMO economist Aaron Goertzen said Friday.
Annual alcohol sales in Canada are expected to top $19 billion this year, about 38 per cent or $700 million higher than in 2011, he said.
By comparison, the retail sector as a whole is usually up 15 per cent to 20 per cent from holiday shopping, the report said.
Sales of spirits, wine and beer typically surge in December, making it the highest volume sales month, Goertzen said from Toronto.
"So we're looking for a jump of around 40 per cent compared to the annual average as people are hosting get togethers and purchasing gifts for family and friends and enjoying the holiday spirit," he said.
That increase will be about the same as last December, he added.
The report also said Quebecers have shown the most pronounced increase in holiday spending on alcohol, with sales rising about 65 per cent above average in December.
"With Quebec being particularly high consumers of wine as opposed to other types of alcohol that could have a particular benefit for growing Canadian wineries," Goertzen said.
Ontarians will increase their booze spending by 45 per cent in December, which should benefit Ontario wine makers whose brands have a strong presence on store shelves in the province, the report said.
British Columbians will only increase holiday spending on booze by 30 per cent, lower than the national average of about 40 per cent, the report said.
The increase in spending on alcohol comes as the economy continues to improve and wine and beer producers continue to make new inroads, the report said.
"The Canadian economy has grown this year, employment has grown, incomes have grown and this is going to support consumption on all fronts, including alcohol sales," Goertzen said.
On Friday, Statistics Canada report that Canada's economy showed surprising bounce last month when 59,300 jobs were added, dropping the unemployment rate two-tenths of a point to 7.2 per cent.
The jobs report from Statistics Canada was among the strongest of the year, not only in terms of job creation, but also in the type of jobs — almost all the gains were in full-time employment and in the private sector.
BMO's Goertzen said Canadians still tend to drink more beer than other types of liquor, but the wine industry is benefiting from an aging population.
"Older consumers tend to have an appreciation for an interest in finer types of wines and they tend to have the means to shell out for a nice bottle, and are inclined do that."
A recent BMO report on Canada's wine industry said that a third of wine consumed in Canada is produced by domestic wineries.
Consumers bought an average of 22 bottles of wine in 2011, up from 13 in 1995, that report also said.
Wine has drained away market share from beer and spirits to the point where it's a third of all alcohol consumption in Canada, the recent report said.
Over the 1995 to 2011 period, wine rose from 18 per cent to 30 per cent of Canadians' total alcohol consumption, while beer fell from 53 per cent to 45 per cent and spirits fell from 29 per cent to 25 per cent.
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