U.S. President Donald Trump has reignited transatlantic commerce tensions, threatening to impose a 200% tariff on all European wine and alcoholic merchandise except the European Union drops its 50% tariff on American whiskey.
The transfer, introduced Thursday on Reality Social, despatched ripples via the beverage trade, sparking market reactions throughout main alcohol producers.
Trump criticized the EU as “one of the crucial hostile and abusive taxing and tariffing authorities within the World” and accused the bloc of exploiting the U.S. economic system.
He warned that except the whiskey tariff was eliminated “instantly,” the U.S. would retaliate with steep duties on “wines, champagnes, & alcoholic merchandise popping out of France and different E.U. represented nations.”
How A lot Is At Stake?
The U.S. is a vital marketplace for European alcohol producers, importing $14.2 billion price of drinks, spirits, and vinegar from the EU in 2024, in keeping with Worldwide Commerce Heart knowledge.
Of that, $5.65 billion got here from wine-related merchandise, making American shoppers a vital income stream for European winemakers.
The U.S. market accounts for practically a fifth of the EU’s international wine exports, a dependence that makes Trump’s tariff risk a major financial concern for the trade.
French, Italian, and Spanish winemakers—who dominate EU exports to the U.S.—would face the brunt of the influence. French producers alone shipped greater than $1.5 billion price of wine to the U.S. final 12 months.
On the opposite aspect, American whiskey producers like Brown-Forman Company BF BF—maker of Jack Daniel’s—stand to achieve if European tariffs are eliminated.
The commerce dispute escalated after the European Fee introduced plans on Wednesday to impose countermeasures on $28 billion price of U.S. items in response to blanket American tariffs on metal and aluminum. This retaliatory stance units the stage for a renewed commerce battle, paying homage to the tit-for-tat tariff battles of the Trump administration.
Market Response: European Alcohol Shares Already Really feel The Warmth
Trump’s tariff warning despatched shockwaves via alcohol shares, notably European producers. Shares of Davide Campari Milano DVCMY tumbled 3.6% throughout European buying and selling, whereas Rémy Cointreau SA REMYF, recognized for its premium cognacs, dropped practically 4%. LVMH Moët Hennessy Louis Vuitton LVMHF, the proprietor of Moët & Chandon and Hennessy, slipped 1.5%.
The U.S. alcohol sector, nevertheless, confirmed blended reactions. Shares of Constellation Manufacturers STZ, which owns Robert Mondavi wines and Corona beer, remained flat in premarket buying and selling in New York. In the meantime, Brown-Forman, a direct beneficiary if European tariffs on whiskey are lifted, rose 2%.
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