Ontario Craft Spirits

distilling equipment in a facility

By: Stuart Laidlaw

For over a century, Canadian liquor meant one thing: rye whisky. But in the early 2010s micro-distilleries started popping up across Ontario, focusing on high-quality, locally produced spirits that tell a story about the communities they come from. Today there are more than 30 craft distilleries in Ontario, producing millions of litres of gin, vodka, white rum, single malt whisky, and, of course, rye. But as the public’s thirst for locally produced drinks grows, distilleries are starting to test the waters with more adventurous, niche products.

  Dillon’s Small Batch Distillers was a founding member of Ontario’s current gin boom, and was an early mover in this new wave of Ontario craft spirits. Founded in 2012 by Master Distiller Geoff Dillon, they opened with a pair of gins, a white rye and a vodka, as well as Ontario’s first homegrown cocktail bitters. At that time, bartenders in the province’s burgeoning craft cocktail scene were keen to get their hands on local spirits that told a story about where they themselves were from. Nick Nemeth, at the time a Niagara-area restaurant manager, now Senior Manager for Beverage Development at Boston Pizza, recalls visiting  Dillon’s Distillers in fall 2012, pre-opening: “What was great about visiting Dillon’s from the onset was that, even though there were other Ontario craft distilleries already, they were experimenting with new spirits and flavours in a way that no one else was at that point.”

  Licensees unexpectedly became a big market for Dillon’s from day 1. “I was shocked by the amount of attention and excitement in the licensee scene,” says Geoff Dillon. “I was excited about making pure, real rye whisky, that was my big thing, that and gin; and the licensees’ [interest]…changed the whole business immediately.”

  In the intervening years Dillon’s has added sweet vermouth, absinthe, black walnut amaro, bitter lemon aperitivo, cassis, peach schnapps and golden plum schnapps to their collection.  Craft cocktail culture continues to inform the product range at Dillon’s. “Bartenders are the ones who have their fingers on the pulse,” says Geoff. “That’s why Adam D’Intino [Dillon’s Sales Manager] is so important. He’s nicely dialled in with what’s going on in the scene, and it really is how we decide what we’re doing moving forward. That’s probably where all the amaros and fun things came from.”

  The amaro that Geoff mentions is his Black Walnut Amaro. It is something of a benchmark for the kind of progressive local spirits that Ontario is starting to produce: an old-world style, made unusual and new by focusing on locally sourced ingredients. “We try to use stuff that we have. My house next door’s got a bunch of big walnut trees,” says Geoff. “We’ve got all these walnuts that fall and we want to get rid of…The community gets together and picks up all the walnuts, and dumps them,” he continues. “I love walnuts. My dad [Peter Dillon, now Head Distiller] is obsessed with bitterness and he loves that pith of the walnuts. So maybe six years ago, we told our neighbours to drop them here if they want. We threw them in 95% ethanol on the pith and let them sit there for two years, and what came out was this incredible bitter, pithy, pitch black liquid.” They blended it with their sweet vermouth base and, after some trial and error, hit on a unique liqueur that tastes smoky, herbal and bittersweet – clearly an amaro, yet unlike anything else.

  Local ingredients play a critical role in everything Dillon’s makes. Its Unfiltered 22 Gin is distilled from locally grown grapes, and their other spirits are distilled from 100% Ontario-grown rye. Their Cherry Gin, Peach Schnapps and Golden Plum Schnapps are all made with locally grown fruit too. Nemeth, reiterating Dillon’s importance in the early days, says, “Other [local] craft distillers 66 Gilead (now Kinsip) and Still Waters…were really only focused on whiskies, whereas Dillon’s was working with local fruit and botanical spirits way more than anyone else.”

  One factor that has contributed to both the number of distilleries and the increased variety of artisanal spirits has been the launch of Niagara College’s Teaching Distillery. Opened in 2018, it looks to have an impact on Canada’s spirits landscape similar to that of the college’s successful Teaching Winery. Students in the college’s Artisan Distilling diploma program are given the opportunity to put their education to practical use throughout the eight-month-long course. They gain valuable hands-on experience with every step of the distilling process, whereas in other programs, students spend about one week in a working distillery. Here again, Dillon’s stamp is indelible: Geoff Dillon helped to write the curriculum, Head Distiller David Dickson was formerly Head Distiller at Dillon’s, and students from the program tour Dillon’s Distillery every semester.

  Although the Teaching Distillery is only two years old, it is already bearing fruit. In 2019 they released their first student-made spirits, including an eau de vie made with grapes grown by the college’s Teaching Winery. And last year, they released their first barrel-aged spirit, a dark rum, followed by an escubac (a long-forgotten type of botanical French liqueur). Graduates of the program have also started to pop up at other distilleries and to start their own ventures, with the Teaching Distillery acting as an incubator for new product ideas. Greg Junop, one of the team who developed that escubac, is now Head Distiller at Niagara Distillery in Niagara Falls. Craig Mann, previously a coffee roaster and café owner, recently graduated from Niagara College and is set to open Manns Botanical Spirits. His inaugural product? A white tea gin made with a tea he was familiar with from his previous career, based on a recipe he experimented with while studying at the Teaching Distillery.

  Still, there are barriers to new spirit producers that are inhibiting growth in Ontario, and forcing the province’s distilleries to focus primarily on the most profitable products. The most obvious is the taxation of spirits. For a bottle of gin that retails at $40.00, $18.37 is paid as tax to the province. Another $9.46 is paid to the Federal Government, leaving the distillery with $12.17 to pay its bills and turn a profit. It is no wonder that micro-distilleries have been reluctant to make more niche products like amaro or aperitivo. It has not prevented distilleries from exploring less well-known drink styles – recent releases include spirits as diverse as saffron liqueur, pastis, Shochu and dry vermouth – but it does present an unnecessary obstacle to experimentation.

  Of course, no discussion of obstacles in 2021 would be complete without mentioning the ongoing Covid-19 pandemic. It has been devastating for the food and beverage sector, with one result being that distilleries, breweries and wineries in Ontario have lost most of their restaurant and bar sales. For operations that rely heavily on those sales accounts, it could have been disastrous. But one of the advantages small distilleries have is the ability to pivot quickly. In early March, Dillon’s committed its stills to the manufacture of sanitizer and disinfectant, leading Ontario’s micro-distilleries in an effort to fill the overwhelming immediate demand, even offering it for free to frontline healthcare workers and other essential services.

  The pandemic did have a positive effect on one particular Dillon’s product: their bottled Negroni . “When we released the Negroni two-and-a-half years ago, it was too early. We thought it was going to blow up and change the world,” says Geoff. The landscape has changed rapidly though. “We’ve sold very little of anything else to licensees,” he laughs. “But we’ve set volume records just selling Negronis. A palette a week was just going to licensees.” Dillon says that it was all mom-and-pop Italian grocery stores and restaurants beside parks in Toronto where, all summer long, people could just crack open chilled, single-serving Negronis to drink outdoors. In fact, it has been so successful that Dillon’s plans to make bottled cocktails a bigger part of their program. “That’s the future,” says Geoff. “We’ve got four or five new ones coming out this year. Most of them are classics, but we’re going to do our own spin on the classics using local cherries, strawberries and that kind of thing.”

  In a marketplace where ‘ready-to-drink’ (RTD) canned cocktails and hard seltzers have exploded in popularity, and at a time when takeout dining has all-but replaced the restaurant experience, it makes sense that micro-distilleries would look to sell more exciting RTD cocktails than Jack-and-Coke. Plus, they give customers an idea of how to use a less well-known product from the distillery, like sweet vermouth or bitter aperitivo, and a chance to sample it before buying a whole bottle. At a time of great uncertainty, when it feels as though much of life is on pause, Dillon’s is still finding ways to develop new, exciting products. Hopefully the rest of Ontario’s craft distilleries continue to follow suit.

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