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In Europe, it’s rare to see prominent displays of American wines. That’s why, traveling around Spain in 2023, I was surprised to see bottles from an excellent California producer in wine bars, shops and restaurants all over the country.
Three years later, those wines are gone. “We had a really good importer, but he didn’t pick up our wines this year,” said the winery proprietor: “It’s hostility — they don’t want to drink American now.” This producer lost wine sales in Canada and Sweden as well.
On taking office last year, President Trump initially placed a 20 percent tariff on goods from the European Union, the source of most wines imported to the United States, before settling on 15 percent in August, though he has periodically threatened to increase the tariff on some countries to 200 percent. The tariffs came at a fragile time for American wine producers: consumption has dropped, health warnings have prompted people to reconsider their relationships with alcoholic beverages, the climate crisis threatens growers and inflation is making it more expensive to run businesses. Big and small wine companies have gone under, and unharvested grapes have been left to rot in vineyards.
One of the administration’s stated aims behind the tariffs was to support American products. But few American wine businesses seem to have benefited. Many instead say the tariffs have made their work far more difficult. Most prominently, Canada, which faces tariffs as high as 35 percent and has been routinely denigrated by Mr. Trump, has virtually halted all imports of American alcoholic beverages. Many other countries have cut back as well.
The resistance to American products overseas has been especially painful for wine producers who had significant export markets, like Kutch Wines, which makes small amounts of exquisite pinot noirs and chardonnays from the Sonoma Coast and the Santa Cruz Mountains. Until 2025, two-thirds of Kutch’s production, about 25,000 bottles, was exported, mostly to Europe. After the tariffs were imposed, 30 percent of those sales disappeared, said Jamie Kutch, the company’s proprietor.
In a business that relies on long-term relationships, the effect of the tariffs — along with Mr. Trump’s stated desire to make Canada the 51st state and to annex Greenland, a territory under Denmark’s control — has been painful. “The Nordic countries, they don’t want to buy American wine. They see it as an ethical thing,” Mr. Kutch said: “We were doing fantastic”- “In 20 years, I never saw a decrease until Trump’s second term — 30 percent, that’s really hard on a small producer.”
Another California winemaker, Ridge Vineyards, a much bigger producer than Kutch, also exported a lot of wine, accounting for 28 percent of its sales. Those export markets have shrunk- “Export has always been a big part of our business, and we’ve seen the effects,” the chief executive said: “The reaction was immediate and severe. Canada just stopped importing. It was our third-largest export market after the United Kingdom and Japan, and it just went away.” .
Even producers without major overseas sales report damage. Adelaida, an excellent midrange winery, exported a small amount of wine to Canada. The loss of Canada was not crippling, but it was not peanuts,” the owner, Mr. Weintraub, said. Like a lot of American producers, Adelaida buys barrels from France, bottles from Mexico and Argentina and winery equipment from France or Italy. All of those products are more expensive because of the tariffs.
Worst of all, Mr. Weintraub said, is the uncertainty over what the government will do next. Farmers accept dealing with unpredictable weather, but the capricious nature of Mr. Trump’s threats to raise tariffs makes planning difficult. “This is not volatile stock trading, it’s farming, making something and lining up buyers for it,” he said. “Every single step has been affected by the uncertainty in a very real and gut-punching way.”
Last year, Rick Rainey, managing partner of Forge Cellars, which makes superb wines in the Finger Lakes region of New York, was planning to buy a new bottling line from Canada. Then came the tariffs. “Suddenly, it went from $100,000 to $130,000,” he said, “so I bought a used one instead.” Forge, too, has lost export business. Forge buys bottles from Portugal. Last year the glass factory absorbed half the cost of the tariffs and the bottle importer the other half. “I can’t imagine they will do that again”, Mr. Rainey said.
Not all American wine businesses have suffered. Jeff Kellogg of Kellogg Selections, which distributes imported and domestic wines in the Carolinas, Virginia and Washington, D.C., said he sold more wine in 2025, though his margins shrank. “That money went to pay tariffs instead of hiring new staff,” he said. He does not see the tariffs helping the American wine industry. Much of his company’s growth, Mr. Kellogg said, came from imported wines rather than American wines, and partly at the expense of other American companies. When the tariffs were first announced, he said, Kellogg Selections went full speed ahead with its plans to buy European wines, while many other importers hesitated, not wishing to pay the tariffs.
The Trump Winery in Charlottesville, Va., did not respond to a request for comment on the tariffs.
Removing tariffs would not solve all the American wine business’s problems, Mr. Kutch said, but it would be a significant step: “It would restore confidence,” he said. “Confidence and predictability are more important than anything else.”
© 2015 Mutual Fund Observer. All rights reserved.
© 2015 Mutual Fund Observer. All rights reserved. Powered by Vanilla
Comments
It is lunacy. He has made enemies of our traditional trade partners. He has energized them all against us. And like everyone expected, funds that should be going to business development and hiring, is instead flowing to the government as taxes - “That money went to pay tariffs instead of hiring new staff,” (Jeff Kellogg) said.
Even when CPI numbers are not capturing the problem with tariffs directly, those headwinds are manifesting in slower hiring, less capital improvement and even businesses profitability. Right now, AI spending may be serving to obfuscate many of these problems, but that cannot last forever. Eventually, the rug will get yanked out. The realization may be explosive.
those headwinds are manifesting in slower hiring, less capital improvement
and even businesses profitability. Right now, AI spending may be serving
to obfuscate many of these problems, but that cannot last forever."
Well said.