It was reported recently that Quebec’s liquor board, the SAQ, will be giving away about $300,000 worth of American alcoholic beverages that are nearing expiry. The initial plan was to discard the stock, but public pressure forced a reversal. In a province long associated with milk dumping due to supply management, rescuing American booze from the same fate is nothing short of ironic.
Since March, when Quebec pulled all U.S. wines and spirits from its shelves, the SAQ has been holding roughly $27 million in inventory. Just storing it has cost taxpayers about $500,000 in warehousing fees. This is the economic cost of politicized supply chain decisions—sunk capital and waste that ultimately land on consumers and taxpayers. Ontario, Nova Scotia, Manitoba, and Newfoundland and Labrador are in the same position, sitting on stock with no announced plan. By contrast, British Columbia, New Brunswick, and the Yukon have sold their remaining inventories to licensees and restaurants, at least extracting some value. Alberta, Saskatchewan, and Nunavut have resumed sales altogether. These approaches are far more sensible, but the question remains: why should government monopolies, rather than consumers, decide what belongs on the shelf?
American exporters see the situation for what it is: a government-imposed ban, not a consumer boycott. That distinction matters, because liquor boards are monopolies, and the perception of abuse of power could eventually invite legal action from American distilleries. In the meantime, the alcohol industry itself is adjusting to larger trade realities.
This week, Diageo confirmed it will close its Crown Royal bottling plant in Amherstburg, Ontario, by February 2026. The company stressed that all Crown Royal will continue to be mashed, distilled, and aged in Canada, but made clear the move is part of a broader strategy to improve efficiency and resilience in its North American supply chain.
The announcement raises another concern: if liquor boards are willing to politicize inventory decisions with American products, will some now target Crown Royal as well—especially Ontario’s LCBO, in the very province where the plant is shutting down?
Such a move would be short-sighted. Crown Royal is not only one of Canada’s most iconic spirits, but also one of the country’s most successful global brands. Jeopardizing its market position for political purposes would risk undermining both domestic pride and export credibility in a sector where Canada actually leads.
While Diageo did not cite tariffs directly, the backdrop is obvious. Higher trade costs and uncertainty are forcing companies across food and beverage to redesign supply chains closer to U.S. consumers. This is exactly what Washington had in mind. By wielding the buying power of nearly 400 million affluent consumers, President Trump’s tariff strategy has enticed firms to onshore and reshore production.
Economic indicators suggest the approach is bearing fruit. U.S. GDP was revised upward this week to 3.3 percent growth in Q2, far stronger than the previously estimated 3.0 percent and a sharp rebound from the 0.5 percent contraction in Q1. Consumer spending remains strong, and predictions of an economic collapse under tariffs have not materialized. For Canadian businesses tied to U.S. markets, the implications are clear: tariffs are no passing phase but a structural feature of the trade environment.
Ottawa’s recent decision to cancel counter-tariffs at least signals a willingness to work pragmatically with its largest trading partner. That move may help restore predictability for Canadian exporters. But the lesson of the SAQ remains: when governments politicize inventory management, taxpayers end up footing the bill, supply chains lose flexibility, and Canada’s credibility as a trading nation is put at risk.
And if liquor boards were ever reckless enough to politicize a global powerhouse like Crown Royal, the damage would go far beyond one brand. It would signal to the world that Canada is willing to sacrifice one of its strongest export success stories on the altar of short-term politics. For a country that already struggles to project itself as a food and beverage leader, turning Crown Royal into collateral damage would be nothing less than economic self-sabotage.
Kudos to Sylvain for shoehorning a reference to dairy supply management, his longtime pet peeve, into a completely unrelated article about U.S. liquor sales in Canada. I didn’t think he could find a way to do it, somehow he did.
The U.S. alcohol ban at the provincial level is a response to an unprecedented attack by the current American administration on virtually every sector of Canada’s export-driven economy, including energy, automobiles, lumber, steel: the list goes on. The Trump administration is trying to get Americans to stop buying Canadian products, and the president was explicit in saying “We don’t need anything from Canada.” Refusing to buy U.S. alcohol is one of the few retaliatory tactics Canada has, and the bonus is that it affects many of the states (like Kentucky) which voted strongest for Trump.
Sylvain’s contention that consumers, rather than government liquor monopolies, should decide what alcohol is sold in their province is a completely different discussion, and the time to have that national debate is not during a trade war with the Americans. Besides, it’s hardly only U.S. alcohol brands affected by provincial liquor board purchasing decisions: I can’t buy Vana Tallinn (very popular in Europe) in my province because the provincial wholesaler doesn’t stock it. But that doesn’t mean that the provincial liquor wholesaling model needs to be discarded entirely.
My hubby for works for the LCBO and I’m a regular shopper there, we both have seen the boom and expansion of Canadian brands on the store shelves and this includes small local brewers and distillers as well which is just awesome. Not only have attitudes greatly shifted against US Booze so have our tastes and habits and this is a huge win for Canadian brands and even some other brands from around the world that are not American. Even IF they put US booze back on the shelves I’m confident it won’t sell well at all and you’ll see once dedicated shelf space for American booze shrink massively! Cheers to our talented Canadian booze brands!