Newfoundland has $3.2M of U.S. alcohol in storage, and government is staying silent on its fate

As other provinces start marketing away U.S. Alcoholic drink with the thought to donate proceeds to charity over the holidays, Newfoundland and Labrador isn't making a decision, yet, on what it plans to do with its $3.2-million inventory.

The previous Liberal government gave the order to remove American-made products from Newfoundland and Labrador Liquor Corporation shelves in response to U.S. President Donald Trump's trade war in early 2025.

Other provinces made similar moves, though over the summer Alberta and Saskatchewan reversed course and started restocking U.S. Products.

Last week, Nova Scotia announced it was selling off its $14-million U.S. Inventory, and about $4 million was promised to Feed Nova Scotia and other food-related charities.

Manitoba followed with a similar announcement on Thursday.

Bruce Keating, president and CEO of the NLC, said the $3.2-million cache is being kept at various NLC locations in the province.

He said any decision regarding the stockpile is in the provincial government’s hands.

“Those kinds of discussions and consultations are continuing,” Keating said. “We’ll continue to have discussions with the provincial government on that.”

The provincial government isn't making public, as of yet, what it intends to do with the inventory.

“While no actions have been taken at this time with respect to the existing U.S. Product for Newfoundland and Labrador, we anticipate a decision in the near future as we continue conversations with the NLC,” spokesperson Kathryn Summers wrote in an email.

Almost a year after U.S. Alcohol was pulled from the NLC's shelves, the impact on the Crown corporation's revenue is evident.

The NLC released its second quarter performance for this fiscal year on Monday, which saw the company's net earnings at $56.3 million. That's a 6.2 per cent drop compared to the same period last year. 

Keating said that decline is in part due to the removal of U.S. Products.

For example, he said, with U.S. Wines no longer on the shelves, customers are buying alternatives from places like Argentina, Chile or within Canada. And although the sales volume is about the same, he said, those wines sell for less.

“We haven't seen the same impact in spirits as we've seen in wines, just in terms of the difference in the average price point," he said. "But there's no doubt, like I said, we felt the effect of the removal of the U.S. Product, [on] our sales and on our earnings.”

Keating said Nova Scotia and New Brunswick felt a similar drop, but the NLC is expecting the third quarter, which includes October, November and the festive holidays in December, to be better financially.

“The third quarter for us would be our biggest quarter of the year,” he said. “Already we're about two months into that and we've seen the results during this quarter. So those have been pretty encouraging.”

Reporter

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