SCHUMER REVEALS: SOUTHERN TIER WINERIES ARE MISSING OUT ON HOT NEW CANNED WINE TREND & BARRELS OF BUSINESS DUE TO ONEROUS CAN-SIZE LIMITS; SENATOR CALLS ON FEDS TO CUT THROUGH BUREAUCRATIC RED TAPE & CRACK OPEN CANNED WINE PRODUCTION IN THE SOUTHERN TIER
Southern Tier Wineries Are Prevented From Selling Wine In Traditional Can Sizes & Are Forced To Scale Out-Of-Date Bureaucratic Hurdles To Have Products Approved For Market
Schumer Urges TTB To Eliminate Can-Size Restrictions And Adjust Lengthy And Burdensome Labeling Process, Which The Agency Is Currently Considering, To Unshackle The Southern Tier Winery Industry And Boost The Regional Economy
Schumer To TTB: Unnecessary Regulations Are Causing The Southern Tier Wine Industry To Sour
Standing at Lakewood Vineyards in Schuyler County, U.S. Senator Charles E. Schumer today launched a multifaceted effort to boost the wine industry in the Southern Tier and across Upstate New York. First, Schumer urged the Alcohol and Tobacco Tax and Trade Bureau (TTB) to allow flexibility in “Standards of Fill” regulations that are preventing Southern Tier wine producers from selling wine in traditional can sizes. Currently, per TTB restrictions, wine can only be sold in less popular can formats such as the 375 ml (12.7 oz) can and the 187 ml can, meanwhile, the popular 355 ml (12 oz) can is prohibited and the popular 250 ml (8.4 oz) can is only allowed to be sold in groups of 3 or 4, and not individually. Additionally, Schumer called on TTB to reduce costly wine-labeling restrictions that burden local producers with unintended red tape. Schumer explained that TTB removing these bureaucratic hurdles would unshackle producers across the state, leading to even further growth.
“Even though it has a $4.8 billion impact on New York, TTB is leaving New York’s wine industry hanging on the vine, with outdated rules and restrictions stopping it from reaching its potential. As canned wine continues to become more and more popular, there’s just no good reason why wine producers, like Lakewood Vineyards, shouldn’t be able to capitalize and sell their products in the most popular-sized cans, especially when studies have shown that lifting these unnecessary restrictions would lead to even further economic growth,” said Senator Schumer. “Similarly, the burdensome and Byzantine TTB label approval process is bogging down our Southern Tier producers and stopping new products from hitting the shelves in a timely manner. That’s why I’m saying to the TTB: cut through this bureaucratic red tape, take these regulations that aren’t helping anybody and can ‘em, and uncork the full potential of the Southern Tier.”
Schumer explained that while wine sold in cans is an increasingly growing consumer market, current TTB Standards of Fill now hamstring Southern Tier-Finger Lakes wine producers, like Lakewood Vineyards, by preventing them from selling wine in popularly-sized cans including 12 oz and 8.4 oz. Even though TTB regulations allow beer to be sold in cans of any size, TTB regulations only permit wine and hard cider above 6.9% Alcohol by Volume (ABV) to be sold in less popular can formats such as the 12.7 oz can and only permit the popular 8.4 oz cans to be sold in a 3 or 4 pack, but not individually.
Schumer argued that these can size regulations are tightly restricting producers’ ability to sell their product, and in turn, restricting their ability to hire new employees and grow their businesses. For example, Schumer pointed to a recent wine consumer survey by WICResearch.com, which concluded “the total wine market will grow in order to satisfy consumer preferences,” if TTB were to permit sales of wine-in-a-can in a single 250ml size, which the survey also revealed is the single-serve size most popular with consumers. Similarly, in comments submitted to TTB, WineAmerica, a prominent trade association for American wineries, urged the bureau to not only allow the sale of single 8.4 oz cans, but also allow the sale of 12 oz cans, because they are less expensive and easier to source than the 12.7 oz cans. Schumer explained that while beer and soft drink producers enjoy a ready supply of 12 oz cans, New York wineries have reported to him as having to wait up to six months to source 12.7 oz cans because they are less commercially viable. Moreover, Schumer said that 12.7 oz cans are often more expensive and require wine producers to buy-in-bulk, which can be cost-prohibitive for smaller wine producers.
Schumer said that in its Proposed Rulemaking 182, TTB is now reviewing whether to eliminate these can size restrictions and allow wine to be sold in any can sized greater than 50 ml, or at a minimum, examining whether to eliminate the restriction against using popularly-sized cans including the 12 oz cans and individual 8.4 oz cans, among others. Schumer announced his strongest possible support for the lifting of these regulations, so that Lakewood Vineyards and other Upstate wine and cider producers can sell their products in more traditional packaging.
Schumer explained that Lakewood Vineyards is a Southern Tier-Finger Lakes Region winery who can some of their wine and want to can more of it, but is hampered by the current federal canning restrictions. Lakewood Vineyards canned a selection of its wine last year, but felt the larger 12.7 oz cans were too large and expensive to be sold. Lakewood Vineyards had also hoped to sell individual 8.4 oz cans, due to their popularity, but was prevented by the TTB restrictions. Unlike the ubiquitous 12 oz cans, the 12.7 oz cans are significantly less commercially viable as well as more expensive for producers. The result of these restrictions is that most Upstate wineries are unable to take full advantage of the hot wine-in-can market, preventing growth and expansion.
Schumer also called on TTB to adjust wine labeling requirements, so as to decrease the regulatory hurdles producers have to jump over. Schumer said that under Notice 176, TTB is considering changes to modernize and streamline its labeling and related regulations to improve understanding of TTB’s regulatory requirements and make compliance easier and less burdensome for industry members. Schumer said these regulatory approvals are required prior to nearly every pivotal step in operating a winery, including before a winery can make a new product, or label and sell a new product. Schumer argued the current myriad patchwork of regulations creates unintended confusion and, oftentimes, costly delays as wineries wait on TTB approvals. Schumer urged TTB to do everything in its power to streamline and modernize these regulations, starting with the finalization of Notice 176.
Schumer also called for the passage of the Craft Beverage Modernization and Tax Reform Act (CBMTRA) of 2019, which would permanently expand the wine producer tax credit set to expire the end of this year, and remove regulatory barriers to help New York winemakers grow and compete. The CBMTRA would also continue funding increases for critical Alcohol and Tobacco Tax and Trade Bureau (TTB) programs to hire additional federal inspectors and reduce often costly delays on TTB regulatory approvals so New York wineries, breweries, and distilleries can expand and sell their products. Senator Schumer joined Senator Ron Wyden (D-OR) and colleagues on both sides of the aisle in support of this legislation, and he will push for its inclusion as part of any upcoming tax extenders package this year.
Schumer was joined by Hans Walter Peterson, Viticulture Specialist, Finger Lakes Grape Program, Cornell Cooperative Extension, Mark Rondinaro, Schuyler County Legislator, Judy Cherry, Executive Director, Schuyler County Partnership for Economic Development, and Chris and Liz Stamp, Owners, Lakewood Vineyards.
Jim Trezise, President, WineAmerica, and the National Association of American Wineries said, "Senator Schumer has for decades been a strong supporter of the New York wine industry, and this is just the latest example. Wine offered in cans is one of the hottest trends in our industry, and the flexibility of packaging will help our producers sell more wine and employ more people. As always, we thank him for his leadership and support."
Chris Stamp, President, Lakewood Vineyards said, “When we started our canned wine program at Lakewood, one of the first decisions we had to make was what size can we would use. For us, the choice came down to the 375ml (12.7 oz) or the 250ml (8.4 oz) cans. We felt that using a 375ml (12.7 oz ) can, which is equivalent to half of a standard wine bottle, was too large of a serving and the 250 ml (8.4 oz) can was a more responsible package size. Unfortunately, 250ml (8.4 oz) by itself is not a permissible volume for sales, and must be packaged in multiples to conform to current regulations. This negatively impacts sales opportunities and increases packaging costs. We thank Senator Schumer for his efforts to address this archaic regulation that has no obvious benefit to producer or consumer.”
Currently, New York State’s grape and wine industry is composed of more than 1,630 family vineyards, 400 wineries, and almost 40,000 acres of cropland. Specifically, the Southern Tier is home to 128 grape growers. Schumer said that the New York grape crop alone is valued at over $52 million and generates $4.8 billion in economic benefits annually for the state and therefore, further growth in the canned wine market is absolutely critical.
A copy of Schumer’s letter to TTB appears below.
Dear Acting Administrator Ryan,
I write to request the Alcohol and Tobacco Tax and Trade Bureau (TTB) take action to first eliminate certain Standards of Fill regulations that now block our wine producers from reaching new customers by selling wine in popularly desired cans while also reducing costly labeling regulations that burden producers with unintended red tape.
Wine sold in cans is an increasingly growing consumer market, but current TTB’s Standards of Fill regulations hamstring U.S. wine producers by prohibiting them from selling wine in popularly-sized cans including 12 oz (355 ml) and individual 8.4 oz (250ml) cans. While TTB regulations allow beer to be sold in any sized can, TTB regulations will only permit wine and cider above 6.9% ABV to be sold in less popular can formats such as the 375 ml (12.7 oz) can and only permit the popular 250 ml cans to be sold in a 3 or 4 pack, but not individually. These can size restrictions are limiting producers ability to sell their product, and in turn to hire additional employees, and grow their businesses. For example a recent wine consumer survey by WICResearch.com concluded “the total wine market will grow in order to satisfy consumer preferences,” if TTB permitted sales of wine-in-a-can in a single 250ml size, which the survey revealed is the single-serve size most popular with consumers. New York wineries have sought to not only use single 250 ml cans but also allow use of 12 oz (355 ml) cans because they are less expensive and easier to source than the 12.7 oz (375ml) can. While beer and soft drink producers enjoy a ready supply of 12 oz cans, New York wineries have reported having to wait up to six months to source 12.7 oz (375 ml) cans because they are less commercially available. Moreover, 375 ml cans are often more expensive and require wine producers to buy-in-bulk which is often cost-prohibitive for smaller wine producers.
In Proposed Rulemaking 182, the TTB is now considering whether to eliminate these can size restrictions and permit wine to be sold in any sized can greater than 50 ml or at a minimum to eliminate the restriction against using popular-sized cans including the 12 oz (355ml), individual 8.4oz (250 ml) cans, and others. I strongly support removing these size restrictions so that wine and cider producers can use popular sized cans and urge the TTB to finalize and implement these changes.
Similarly, under Notice 176, TTB is considering changes to modernize and streamline its labeling and related regulations to improve understanding of TTB’s regulatory requirements and make compliance easier and less burdensome for industry members. These regulatory approvals are required prior to nearly every pivotal step in operating a winery including before a winery can make a new product, or label and sell a product. However, the current myriad patchwork of regulations create unintended confusion and often costly delays as wineries wait on receiving TTB approvals to produce or sell and new product. I therefore support streamlining and modernizing these regulations and urge the TTB to finalize and implement these revisions.
Thank you for your consideration of this matter.