DISCUS Details The Fallout From E.U. Tariffs On American Whiskies
June 23, 2020American whiskey exports have been dealt a significant blow by European Union tariffs over the past two years, according to a new report from the Distilled Spirits Council of the U.S. (DISCUS). Since the 25% tariffs were imposed in mid-2018 in retaliation for U.S. tariffs on E.U. steel and aluminum, American whiskey shipments to Europe have declined by 33%, with smaller producers suffering the hardest hit.
“From January 1997 through June 2018, American whiskey exports to the E.U. grew fivefold from $143 million to over $750 million,” according to DISCUS. “Had the tariffs not been implemented, American whiskey exports today would be an estimated $300 million higher.”
“These tariffs took the wind out of the sails for American whiskey exports to our top export market,” said DISCUS president and CEO Chris Swonger, adding that the E.U. tariffs are scheduled to rise to 50% in June 2021 unless an agreement is reached between the two sides. The E.U. accounted for 52% of American whiskey exports last year.
“The tariff situation has been awful,” said Brown-Forman president and CEO Lawson Whiting in a recent interview with SND. “It’s in the range of $100 million a year in cost to us, which we’ve absorbed in order to maintain momentum with our consumers. We’re being opportunistic, taking price in a handful of markets, but it’s tough in those markets.” Still, Whiting added that Brown-Forman continues to “believe in the long-term potential for American whiskey in Europe,” and that both the company and its competitors are working in concert to get the tariffs removed.—Daniel Marsteller
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