The Yukon Brewing Company may decide to start making spirits now that the Yukon government allows businesses to operate wineries and distilleries.
Passed in June, the amendment to the Liquor Act added and defined “liquor manufacturer” to include the makers of beer, spirits or wine.
Previously, the only reference to liquor manufacturing was to brewers, prohibiting entrepreneurs from making any liquor other than beer.
The Whitehorse-based brewer has been pressing for a change to the liquor act for about a year and the amendment means the company can seriously consider moving forward with a distillery, said company president Bob Baxter.
But there are still market studies and product development to complete before deciding what liquor to manufacture. It’s the same approach the company took when first opening 10 years ago, said Baxter.
“It’s the way we’ve grown our brewing business; we didn’t go out and try to get big overnight,” he said. “We took our time and grew a bit every year and we don’t intend to abandon that formula.”
Much of the company’s brewery equipment can be adapted for the distilling process, cutting the cost of making spirits, said Baxter.
“To run a still you need heat. One of the ways to provide heat is through steam and we already use a steam system to make beer,” said Baxter, citing one example of synergy.
The company is considering purchasing equipment that doesn’t have limitations on what kind of hard booze it can produce, which creates options for making clear spirits like vodka and gin, or aged spirits like whiskey and rum.
“But that’s a double-edged sword,” said Baxter. “If you can produce anything, then what you want to produce is what the market wants. So what does the market want?”
While age can help make a scotch smooth to drink, the 30-year-old liquor act hasn’t improved with age, said NDP MLA Steve Cardiff.
The government has failed to act on several key recommendations made in a 2001 review of the legislation, including improvements of enforcement and inspections and the elimination of the room requirement bars must meet to qualify for a liquor licence, said Cardiff.
“There’s a group of people in the territory who have a monopoly on the sale and distribution of liquor in bars because you have to have hotel rooms to have a licence,” he said.
“They probably don’t want to see things changed and they have influence on the government,” he said, adding that a change to the room requirement would open up the liquor market.
“There would be more competition and business opportunities, which is exactly what this government is saying about (the need for) wineries and distilleries.”
Cardiff voted in favour of the amendment in June and said, “there is no doubt” it will allow for new businesses and job opportunities in the territory.
The Yukon Brewing Company expects more work for current employees if it opens a distillery, which could also lead to new jobs because of the long shelf life of hard liquor.
As consumption declines after summer, the brewery makes less beer because storage is a problem.
The long shelf life of hard liquor would allow the distillery to continue production through the winter.
“We would make better use of people hired now and could add jobs later,” said Baxter.
But there is still room to improve the liquor market and Baxter points to BC where the provincial government allows quality wineries to sell their products in their own stores, cutting out the middleman.
“It’s saying, ‘If we take a little less of a cut here, we’ll benefit in other ways,’” said Baxter. “There are still other opportunities for the government to support local alcohol producers.”
“Any dollar spent on alcohol — or any product — made Outside leaves the Yukon. Every dollar spent in the Yukon on Yukon products circles the territory.”
The government could also help by promoting responsible drinking and by dealing with the problem of overserving and providing more services for those with addictions, said Cardiff.
Promotion of responsible drinking through eliminating the liquor act’s room requirement could mean people walk down to a neighbourhood pub rather than driving across town, and then driving back after drinking, said Cardiff
“The liquor act is very, very old. It needs to be updated, like many pieces of legislation. It’s about the political will to get things changed,” he added.
Calls to the Yukon Party caucus office and communications staff were not returned.