This Wednesday, European Commission President Ursula von der Leyen addressed the European Parliament with a critical update on the ongoing trade negotiations between the European Union and the United States.
As diplomatic dialogue continues, the stakes have rarely been higher—especially for vulnerable sectors like European wine, which finds itself on the front lines of an escalating tariff dispute.
Von der Leyen emphasized that the EU remains in continuous dialogue with the U.S. administration, working to avoid the imposition of new tariffs that would hit European producers hard and strain transatlantic relations. However, she made clear that the European Union is also preparing for all possible outcomes, signaling the seriousness of the situation.
According to von der Leyen, tariffs imposed by the United States since February already affect 70% of trade between the two blocs. These include a 10% general tariff on European goods and an even steeper 25% levy on steel, aluminum, and automobiles. Tensions have been further inflamed by U.S. President Donald Trump’s threats to raise tariffs to 50%, potentially issuing a formal notification to the EU in the coming days, following the tariff extension deadline set for August 1.
Among the sectors most vulnerable to these developments is the European wine industry, a powerhouse in exports and a pillar of rural economies across France, Italy, Spain, and beyond. The U.S. market is one of the largest and most profitable for European wines. Any increase in tariffs would drastically erode competitiveness, giving an edge to producers from non-EU countries like Chile, Argentina, and Australia.
Wine producers across the continent still recall the financial shock from previous trade tensions, when retaliatory tariffs caused a significant drop in exports, triggering losses, layoffs, and an urgent search for new markets. This experience has left the sector wary and watchful, especially amid ongoing economic uncertainties and high inflation.
The European Commission has taken a firm stance against these tariffs, arguing that protectionist policies harm both European and American businesses. Von der Leyen stressed the importance of negotiation over confrontation, noting the EU’s success in concluding recent trade agreements with Mercosur, Mexico, and Switzerland, and the prospect of finalizing a deal with India by year’s end.
Yet this is cold comfort for winegrowers and exporters who remain in limbo. Winery associations and agricultural unions have called on Brussels to vigorously defend their interests and secure continued access to the U.S. market. The lack of clarity is already disrupting export strategies, leading many wineries to delay investments, scale back promotion plans, or diversify toward Asian and Latin American markets.
For small and mid-sized producers, this uncertainty can be existential. The U.S. market is not easily replaceable, and the tariffs would likely translate into higher prices for American consumers, reducing demand for European bottles.
Von der Leyen urged MEPs to recognize this critical moment as a chance to reassert Europe's influence in global trade. But she also acknowledged the persistent risk of a trade escalation, which would have consequences for thousands of EU exporters.
As the August 1 deadline approaches and pressure mounts, the European wine sector will remain alert, watching both Brussels and Washington for signs of resolution—or retaliation. The next few weeks will be decisive in shaping the future of transatlantic trade and the economic health of one of Europe’s most emblematic industries.
Source: Vinetur