The U.S. wine industry is bracing for a potential crisis as President Donald Trump has threatened to impose a staggering 200% tariff on European wines, Champagne, and spirits.
This proposed measure comes in retaliation to the European Union's planned 50% tariff on American whiskey, set to take effect on April 1. The looming trade war is causing widespread concern among wine importers, retailers, and consumers, who fear that the steep tariffs could significantly disrupt the industry.
A Market on Edge
Wine sellers and importers across the United States are worried that such a dramatic price increase would lead to a sharp decline in demand for European wines. Ronnie Sanders, CEO of Vine Street Imports in New Jersey, doubts that American consumers will be willing to pay significantly higher prices for their favorite European bottles. “The cost increase would be so extreme that it could wipe out entire segments of the market,” Sanders noted.
Jeff Zacharia, president of the fine wine retailer Zachys in New York, shares similar concerns. European wines make up 80% of his company’s sales, and he fears that U.S. wine merchants simply won’t have the domestic supply to replace them. As a precaution, Zacharia has already halted new purchases of European wines, awaiting more clarity on the situation.
Europe’s Critical Role in U.S. Alcohol Consumption
According to global alcohol data provider IWSR, European wines and spirits accounted for 17% of total alcohol consumption in the U.S. in 2023. Italy and France are particularly vital to the American wine market, supplying premium wines that many consumers have come to expect. The U.S. remains a net importer of alcohol, with foreign alcoholic beverages making up 14% of all U.S. agricultural imports in 2022.
Marten Lodewijks, president of IWSR U.S., explained that while a 200% tariff is not unprecedented, such high import duties are typically more targeted. He pointed to China’s 2020 tariffs on Australian wine, which caused a 90% drop in exports. Even though China eventually lifted those tariffs, the Australian wine industry had already suffered massive losses. A similar scenario could unfold in the U.S. if European wines are priced out of the market.
Europe’s Response and Global Trade Concerns
The threat of tariffs has already sparked alarm in Europe. Ettore Prandini, president of Italy’s Coldiretti agriculture lobby, warned that retaliatory measures could lead to a full-scale trade war, harming both U.S. consumers and farmers. Italian wine exports to the U.S. reached 1.9 billion euros last year, highlighting the deep economic ties at stake.
In France, the U.S. market for wines and spirits is valued at 4 billion euros annually. Gabriel Picard, head of the French Federation of Exporters of Wines and Spirits, called the potential tariffs “devastating” for the French alcohol export industry. Some European winemakers have already begun to cancel planned shipments to the U.S., citing fears of financial losses. Jacques Barreau, co-founder of the French wine transporter Grain de Sail, reported that exports to the U.S. have nearly halted due to the uncertainty.
Wine Retailers React as Consumers Rush to Buy
While some European wine shipments have paused, American wine retailers are scrambling to adjust. A wine bar in Washington, D.C., recently launched a “tariff sale,” urging customers to stock up on their favorite bottles before prices skyrocket. However, some industry insiders remain skeptical about whether Trump will actually follow through with the 200% tariff.
Mark O’Callaghan, founder of Exit 9 Wine & Liquor Warehouse in New York, pointed to the rapidly shifting political landscape. “This situation is changing every day. If the tariff does happen, it could fundamentally reshape the U.S. wine market—but right now, it’s too soon to tell,” he said.
Major alcohol distributors such as Total Wine and Southern Glazer’s Wine & Spirits have not yet commented on the potential tariffs. With the April 1 deadline looming and trade tensions escalating, businesses and consumers alike are anxiously waiting to see how the situation unfolds.
Source: Vinetur