US Whiskey Producers Bracing For Potentially Devastating EU Tariffs Amid Trade Dispute: 'We're Just Collateral Damage'

The U.S. whiskey industry is bracing for a potential blow as tariffs from the European Union (EU) threaten to increase to 50% on every bottle shipped across the Atlantic starting in 2024.

The EU’s looming tariff threat, as reported by The Wall Street Journal, comes as a retaliatory move against U.S. tariffs on European steel and aluminum. This step has inadvertently damaged the prospects of U.S. whiskey producers and other small enterprises, according to Brooke Glover, owner of the Swilled Dog distillery.

"We're just collateral damage," Glover said.

Both EU and U.S. officials are striving to reach a deal to postpone the implementation of the tariff by the year-end. However, the broader trade dispute’s uncertainty continues to overshadow the whiskey industry, hindering investment in foreign markets, stated Jeff Quint, CEO of Cedar Ridge Distillery.

“Nobody's going to make a significant investment in teaching the world about bourbon until we know these tariffs have been eliminated,” he added.

The U.S. whiskey industry was pulled into the trade dispute in 2018 following former President Donald Trump’s decision to impose tariffs on steel and aluminum. The EU responded by levying tariffs on several iconic U.S. exports, including whiskey.

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The original whiskey tariff imposed by the EU was 25%. This was put on hold two years ago as part of an agreement to suspend both U.S. metals tariffs and EU retaliatory tariffs until 2024. However, if an agreement isn’t reached before this date, the whiskey tariffs could be reintroduced—this time at double the rate.

The U.S. now proposes a two-year extension of the current tariff reprieve, which would put both U.S. and EU tariffs on hold until the end of 2025. Both parties have expressed their wish to avoid a repeat of the previous tariff war.

This uncertainty presents a significant challenge for whiskey distillers as their product needs to age, forcing them to plan years in advance. A 50% tariff “would be an utter disaster for the American whiskey industry here in the U.S.,” warned Chris Swonger, president of the Distilled Spirits Council of the United States.

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