For months, producers, importers, distributors, and restaurateurs on both sides of the Atlantic have been pressing for a tariff-free market in wine and spirits.
Yet hopes for a breakthrough are fading. According to a recent New York Times report citing a White House official, wine and spirits are unlikely to appear on the “zero-for-zero” list in the upcoming US-EU trade agreement.
A Cold Shower for the Industry
European negotiators have argued persistently that alcohol should remain exempt from tariffs, in line with decades of tradition. For years, wine and spirits moved freely between the two markets without the burden of trade duties. However, as negotiations between Washington and Brussels near their conclusion, it seems increasingly improbable that the 15% US tariff on alcohol will be removed.
The New York Times, in its August 19 article co-authored by Jeanna Smialek, Tony Romm, and Julie Creswell, underscored that wines and spirits were never formally included in the draft text of the agreement. While diplomacy continues, the absence of an exemption at this late stage does not bode well for industry players.
Economic Stakes on Both Sides
The implications are significant. Italy, the largest EU wine exporter to the United States, shipped EUR 838.7 million worth of wine in the first five months of 2025 alone—an increase of 5.7% compared to the same period in 2024, according to ISTAT. The US is Italy’s single largest export destination, making tariff risks especially troubling for its producers.
Meanwhile, in the United States, the wine trade and restaurant sectors also face pressure. According to the US Wine Trade Alliance, EU wines generate USD 23.9 billion in revenue in the American market, while only USD 5.3 billion flows back to Europe, creating a surplus of nearly USD 19 billion for the US economy. Tariffs could upset this balance, raising prices for consumers, reducing competitiveness for restaurants and distributors, and straining transatlantic relationships at a sensitive time.
Industry Concerns
Stakeholders warn that tariffs risk creating ripple effects across the supply chain:
- European producers could face reduced demand, particularly for mid-range wines where price sensitivity is high.
- American importers and distributors may lose margin or struggle to pass higher costs on to consumers.
- Restaurants and hospitality operators risk declining sales if wine lists become more expensive or less diverse.
For luxury and premium categories, demand may remain stable, but the middle of the market—the true driver of volume—could experience the most disruption.
Outlook
Diplomatic efforts continue, and both sides acknowledge the importance of wines and spirits in transatlantic trade. Yet, as negotiations reach their final phase, tariffs appear to be a reality the industry must brace for in the short to medium term.
While optimism remains that the issue could be revisited in the future, for now, the sector faces a more complex, costlier trading environment. For European producers, particularly in Italy, France, and Spain, and for American businesses deeply integrated with EU supply chains, the coming months will be critical in adapting to a changing trade landscape.
Source: WineNews