US booze importers are canceling shipments from Europe — and bracing for potentially devastating losses — as President Trump threatens tariffs as high as 200% that could go into effect next month.
The US Wine Trade Alliance, which represents some 6,000 retailers and wholesalers, said President Trump’s threat to slap a 200% tariff on European alcohol has had a chilling effect, with some importers immediately canceling orders that weren’t already on ships or at docks.
Grassroots Wine, a Charleston, SC-based distributor, nixed a $1 million order of European wines last week.
Its owner Harry Root says he meanwhile has a shipment of $250,000 worth of Italian and French wines that are supposed to arrive in early April.
A 200% tariff would spark a tax bill of $500,000 for the 23-year-old, family-run business, whose clients include stores and restaurants in South Carolina and Alabama.
“That’s more money than we make in profit every year,” Root told The Post. “If we had to come up with $500K it would begin the wind down of our company.”
The US Wine Trade Alliance is pushing for a so-called ‘goods-on-the-water’ exemption that would allow any US business to avoid the tariff if their merchandise is in transit when the tax goes into effect.
In the meantime, the USWTA advised its members in a memo this week to “halt all shipments of wine, spirits & beer from the EU” because the current risk of tariffs is “too high.”
“The flat reality is there is no guarantee of an exception,” according to the USWTA’s Tuesday memo.
“We believe it possible the US could immediately retaliate with tariffs on April 2,” according to the USWTA memo.
On Thursday, the EU pushed back the deadline for its tariffs on American bourbon to mid-April after it announced a 50% whiskey tariff — set to be imposed on April 1 — as a response to Trump’s new tariff on all steel and aluminum imports that went into effect this month.
“This provides additional time for discussions with the US administration,” EU trade spokesman Olof Gill said in a statement, according to an AFP report, adding that “constructive dialogue with the US, in order to seek a solution that avoids unnecessary harm to both economies.”
Last week, in response to the EU’s 50% whiskey tariff, President Trump unveiled his threat of a 200% tariff on all alcoholic beverages from the EU.
“This will be great for the Wine and Champagne businesses in the U.S,” Trump wrote on Truth Social last week.
American importers and distributors see it differently.
US importers “will have to make a decision on whether to risk a 50% to 200% tariff,” Ben Aneff, president of US Wine Trade Alliance, told The Post. “Anything between those two numbers could bankrupt a business.”
If the tariff war escalates, consumers will notice by May or June that some of their “favorite” wines are no longer available, Aneff said. Summer wines including Roses and Rieslings haven’t even arrived yet, he added.
For restaurants, the loss of European wines cuts into their already thin profit margins.
“Restaurants rely on imported wine for their existence,” Aneff said.
Europe accounts for 80% of all the wine that’s imported into the US, according to the American Association of Wine Economists.
Consumers have already begun to stockpile European wines in anticipation of tariffs, as The Post reported.
The first round of booze tariffs in 2019 slapped European alcohol with a 25% tax and resulted French wine imports falling by 54% and German imports by 42%.
