Alberta distillery to stop making 4-litre vodka jugs after minister raises concern

A distillery is halting production of discount four-litre vodka jugs after the Alberta minister responsible for the province’s liquor industry called out the product for not being responsibly priced.

T-Rex Distillery says public response has been mixed since photos of the jugs began circulating on social media, with about half praising the jugs for “innovation and convenience.”

Others expressed concern, including Service Alberta Minister Dale Nally, who says the low $49.95 price was “not very responsible” and that he was looking at intervening.

The Edmonton-area distillery says the jugs are a private-label product produced and bottled for a customer, Super Value Liquor, at its requested price.

Under current rules, Alberta Gaming, Liquor and Cannabis sets the wholesale price retailers must pay to purchase products, but T-Rex says there are no rules or guidelines provided by the agency as to how a product should be priced on shelves.

Federal laws regulate alcohol labelling and packaging across Canada, and Nally says the jugs are in compliance.

“What it’s not in compliance with is the spirit of Albertans,” he told reporters Monday. “We believe in responsible pricing, and that’s where I think it goes afoul.”

Nally’s ministry did not immediately clarify what specific steps the government might take on pricing.

The plastic jugs, which are similar to four-litre milk containers, have plain labels with the words “value” and “vodka” over a yellow background.

Sunny Bhullar, manager at Edmonton Super Value Liquor, said his store discounted the jugs down from $60.

“We make sure we are serving our customers in a responsible way,” said Bhullar in an interview.

He said the store aims to provide quality products for consumers looking to buy bulk and save money.

“Our marketing approach is we sell at a fair price,” he said.

Should Nally introduce minimum prices or a floor price, Bhullar said he would be concerned.

“In that scenario, it will be hard for independent stores to compete with the bigger chains,” he said.

T-Rex said in an email that its vodka jugs have been for sale for about a year. It also offers a T-Rex-branded version of the jug, primarily for wholesale purposes, such as for bars and restaurants.

The company said the vodka jugs were reviewed and approved by Alberta Gaming, Liquor and Cannabis and, as of Monday, T-Rex had not received any communications from the agency, the government or the minister.

“Albertan craft distilleries have suffered from a lack of responsible pricing for a while now and, in fact, there are multiple distilleries out there that are selling their spirits even cheaper than T-Rex,” the company said. “We have often voiced our concerns with the current system to AGLC.”

Nally made his comment before introducing an omnibus red-tape reduction bill that he said would clarify he has authority to set liquor prices.

Nally added, “If this bill passes, then this is exactly the type of thing that I will look into. I don’t think a four-litre plastic jug of vodka adds to the quality of the distillery industry that we have in this province. I don’t think that it is responsible pricing.”

Nally said that with the bill he hopes to make sure the rules reflect what happens in practice, since the AGLC, which is responsible for overseeing the liquor industry across the province, doesn’t increase prices without getting approval from the minister.

T-Rex said an “era of unsustainable prices” began when AGLC removed a few years ago a rule that required craft distilleries to produce at least 80 per cent of their own spirits in-house, and 20 per cent was allowed to be purchased or imported in bulk.

That means anyone can blend and sell bulk-purchased vodka without owning distilling equipment, said T-Rex. The company said it and other craft distilleries were forced to lower their prices to stay in business, especially after making investments in distillery equipment, which new companies don’t need to do.

The AGLC said it was not able to respond Monday to questions about regulations for the four-litre vodka jugs. It did not immediately respond later in the day when emailed questions about production rules for craft distilleries.