In response to high duties imposed on Canadian goods, retailers have been pulling American-made bourbon from their shelves.
Louisville, Kentucky — A developing trade war between the United States and Canada is targeting distilleries at the center of the American bourbon sector.
In response to tariffs imposed by the Trump administration on its products, Canadian retailers are removing American-made alcohol from their shelves.
According to certain Kentucky bourbon companies, it’s also causing stalled liquor deals with possible trading partners and cancelled shipment orders.
As a result of liquor retailers in the majority of Canadian provinces being forced to take items off their shelves, Louisville’s family-run Michter’s Distillery has already lost $115,000 in canceled bourbon shipment orders to Canada, its biggest overseas market.
Andrea Wilson, Michter’s chief operating officer, stated, “That’s the truth of it.” “We’d rather have fewer tariffs than more.”
Fearing a wider trade war, Trump delayed his earlier announcement of a 25% tariff on products imported from Canada and Mexico, two of the nation’s biggest trading partners, earlier this month.
Trump stepped up his aggressive tariff rhetoric on Tuesday, declaring he would raise taxes on Canadian-imported steel and aluminum.
The threat was made a day after the premier of Ontario, the most populous province in Canada, declared that 1.5 million Americans will pay a 25% increase in power rates.
The Kentucky Distillers’ Association estimates that the state’s bourbon business contributes roughly $9 billion to the local economy each year.
According to the group, almost 95% of the bourbon distributed worldwide is produced in the state.
According to Marten Lodewijks, president of the U.S. branch of the beverage industry data firm IWSR, U.S. consumers probably won’t see a price hike on bourbon for at least a few months, even if data on the impact of the tariffs is not yet available.
However, if some of their shipments to Canada are being canceled, Kentucky distilleries may be hit hard right away, he said.
Wilson expressed her concern that if the tariff battle goes on, her company would suffer more losses.
It’s quite unfortunate for us because we have connections and relationships in that nation that date back a long way, and it would have a big impact on our business if we weren’t selling to our biggest export market,” she added.
The tariff war is causing its own set of issues for Louisville’s Black-owned Brough Brothers Distillery.
