The wine trade between the United States and Canada has entered a period of profound transformation in 2025. Between February and August, U.S. wine exports to Canada fell by 82.2% in value and 60.8% in volume, according to data from Del Rey AWM.
This steep decline represents a loss of CAD 257 million within just seven months, largely attributed to the new tariffs introduced by the Trump administration earlier this year, which reignited trade tensions between the two neighboring countries.
A Key Market in Transition
Canada remains one of the most dynamic wine markets in the world, with an annual consumption exceeding five million hectoliters. However, domestic production is limited to about 0.7 million hectoliters, leaving a substantial gap filled by imports totaling around 4.1 million hectoliters annually. The value of these imports has risen by 16.5% since 2017, now reaching approximately CAD 2.8 billion.
Despite the sharp drop in U.S. imports, Canadian wine consumption has not weakened. Instead, the market has diversified its sources. Countries such as Chile, New Zealand, and France have capitalized on the void left by American wines.
- Chile increased exports to Canada by 22% in value and 37.8% in volume.
- New Zealand achieved 31% value growth and 42.4% volume growth.
- France, already the leading supplier by value, expanded its presence by 19%.
- Italy and Spain also posted solid gains, with increases of 9% and 16%, respectively, in volume.
This rapid reorientation underscores Canada’s resilience as a mature and adaptable import market.
Shifting Price Structures and Consumer Preferences
Although total imported volume slightly decreased—from 4.1 million to between 3.7 and 3.9 million hectoliters—the total value of imports rose, reflecting a clear premiumization trend. The average import price per liter climbed from CAD 5.84 in 2017 to CAD 7.33 in 2025, a 25% increase over eight years.
This growth is not only a result of global inflation but also a shift in Canadian consumer behavior. Buyers are increasingly gravitating toward higher-quality wines with certified origins, particularly those from France, Italy, and New Zealand.
The bottled still wine segment remains the cornerstone of Canadian imports, representing two-thirds of total volume and nearly 95% of total import value. Bulk wines, while accounting for only 4% of value, continue to occupy a relevant space in terms of volume for industrial and blending purposes.
Canada’s Role as a Wine Exporter
An intriguing aspect of the Canadian wine industry is its role as an exporter despite its limited production. Canada exports nearly two million hectoliters annually, most of which are sent to the United States and consist primarily of bulk wine. Analysts suggest that some of these volumes are re-exports or industrial blends, benefiting from logistical advantages and favorable trade agreements.
However, the International Organisation of Vine and Wine (OIV) has highlighted statistical inconsistencies in Canada’s reported trade flows, questioning the origin and final destination of certain shipments.
Canadian exports have also been negatively impacted by the current trade friction with the United States. Between February and August, total exports—largely destined for the U.S.—fell by 22.7% in volume and 6.7% in value, with an average export price of just CAD 0.65 per liter, confirming the dominance of bulk and low-value wine exports.
A Market Realigning Toward Global Suppliers
The evolving situation illustrates a major restructuring of North American wine trade. The decline in U.S. exports has created opportunities for other wine-producing nations, particularly in the Southern Hemisphere. Chile and New Zealand, already known for their strong price–quality balance, have significantly expanded their foothold in Canada.
At the same time, the Canadian market remains highly attractive for international producers due to its stable demand, growing appreciation for premium wines, and sophisticated distribution network.
While U.S. producers face the challenge of regaining lost market share under restrictive trade conditions, other exporting nations are strengthening their positions, reinforcing Canada’s role as a strategic global hub for wine imports and distribution.
Source: Vinetur