Print Edition - 2019-03-23 | MONEY
Export slump deepens for American whiskey producers
Mar 23, 2019-
American whiskey producers are suffering a worsening hangover from the Trump administration’s trade disputes.Overall exports of bourbon, Tennessee whiskey and rye whiskey fell 11 percent during the second half of 2018 compared to the prior-year period, as the impact of tariffs started to be felt, the Distilled Spirits Council said in a report Thursday. The drop off was even larger in the European Union, the industry’s biggest export market. Last month, the council said total American whiskey exports declined by 8.2 percent between July and November of 2018, but that report did not include December numbers.
“With the full-year data in hand, it is clear that the retaliatory tariffs are having a significant and growing impact on American whiskey exports,” council President and CEO Chris Swonger said in a release. “The damage to American whiskey exports is now accelerating, and this is collateral damage from ongoing global trade disputes.”
American whiskey makers have been caught in the middle since mid-2018, when the EU targeted American whiskey and other US products in response to President Donald Trump’s decision to slap tariffs on European steel and aluminium.
Whiskey makers in the US also face retaliatory tariffs in Canada, Mexico, China and Turkey as part of other trade disputes.
Those duties amount to a tax, which producers can either absorb in reduced profits, or pass along to customers through higher prices—and risk losing market share in highly competitive markets.
In the EU, American whiskey exports declined 13.4 percent in the second half of 2018 when tariffs slammed the brakes on shipments, the council said. It was a much steeper drop than the 8.7 percent export decline the council had reported for July through November of last year.
The EU still accounted for nearly 60 percent of total American whiskey exports in 2018. The United Kingdom, Spain, Germany and France are among top export destinations for American spirits.
Published: 23-03-2019 21:17