Recent rumblings of new tariffs in U.S.-Europe trade have the wine industry bracing for disruption. Memories of the 2019 trade dispute – when the U.S. imposed a 25% duty on certain European wines – are still fresh. Such tariffs can reverberate through the entire supply chain, raising prices, shifting consumer behavior, and straining international relationships. This article provides an in-depth analysis for wine producers on both sides of the Atlantic, examining potential impacts and outlining strategies to navigate a volatile trade environment. It also focuses on tools that can help mitigate risks and adapt to geopolitical trade tensions requiring information and connections.
BestWineImporters (BWI) is a platform designed to equip wine producers with exactly those tools, helping them find reliable import partners worldwide and maintain stable business even amid tariff uncertainty.
Impact on European Wine Producers
Transatlantic Wine Trade Imbalance: European wine exporters like Italy and France ship millions of hectoliters to the U.S. each year, whereas European imports of U.S. wine are moderate. This realtively one-sided reliance means European producers stand to lose disproportionately more from any U.S. tariffs on wine.
If the U.S. imposes tariffs on European wine, the immediate consequence is higher prices for those wines in the American market. In the 2019 Airbus-Boeing dispute, for example, the U.S. added a 25% tariff on still wines from France, Germany, Spain, and the UK. Almost overnight, European wine became significantly more expensive for U.S. importers, distributors, and consumers.
These costs were largely passed down the line, resulting in higher retail prices for European bottles in U.S. shops and restaurants. A U.S. restaurant owner illustrated the effect: a $45 bottle of Austrian Grüner Veltliner could jump to $60 under hefty new tariffs, a price that would deter many customers and cut into sales.
Such price hikes inevitably erode market share for European producers. American consumers, facing costlier French Bordeaux or Italian Prosecco, may shift to more affordable alternatives – whether domestic wines from California, Oregon, and Washington, or imports from countries not subject to the tariff (for instance, wines from South America or Australia). In the 2019 tariff period, some European wineries even tweaked their products to blunt the impact (one tactic was slightly increasing alcohol content to move wines out of the tariff category).
But these workarounds offer only limited relief. When a favorite €10 European wine suddenly costs much more, many price-sensitive buyers will switch to a comparable U.S. wine or an untariffed origin. Over time this can translate into lost shelf space and restaurant placements for European labels, as importers and sommeliers adjust their portfolios to maintain value for customers.
Beyond lost sales, European producers may face long-term brand erosion in the U.S. if tariffs persist. Wines that become scarce or too pricey could see their fan base shrink as consumers develop new habits. For example, if French rosé is priced out, American drinkers might discover Spanish rosado or domestically produced rosé and stick with those even after tariffs lift. In essence, tariffs threaten to undo years of market development by European wineries in the United States.
It’s worth noting that the pain of tariffs is shared across the industry. Every dollar spent on European wine in the U.S. generates about $4.5 in profit across the importer–distributor–retailer chain.
Tariffs disrupt this ecosystem: U.S. distributors and retailers selling European wines see reduced volume and thinner margins, and high-end restaurants specializing in European cuisine struggle to find equivalent quality at similar cost.
Many businesses will respond by curbing orders of European wine. Ultimately, European producers would face not just higher prices, but a significant drop in demand in what is often their most lucrative export market.
Impact on U.S. Wine Producers
European tariffs
Tariffs are a two-way street. If the U.S. hits Europe with wine duties, European countries may retaliate with their own tariffs on American wines. In past disputes, Europe hasn’t hesitated to target iconic American beverages – for instance, a 25% tariff was slapped on American whiskey during the 2019 standoff.
A similar punitive duty on U.S. wines is a real possibility in a prolonged trade war. This would directly affect U.S. wine producers who export to Europe by making their bottles more expensive (and thus less competitive) in European retail and hospitality.
The U.S. doesn’t export nearly as much wine to Europe as Europe sends to the U.S., importing only a trickle of American wine.
However, losing the European market would still sting for American wineries, especially premium producers who have cultivated a presence in cities like London, Berlin, or Copenhagen. If Europe imposes, say, a 25% tariff on Californian wine, importers in the EU would likely scale back orders sharply. European merchants could fill the gap with wines from other New World countries (Argentina, Chile, South Africa, etc.) or simply push more local European wines, which are abundant. American wines, already a niche in much of Europe, could fade from wine lists and store shelves due to inflated pricing.
We have a telling parallel from another trade conflict: when the U.S. imposed tariffs on Chinese goods in 2018, China retaliated by placing a 15% tariff on U.S. wine. The result was a dramatic fall in American wine exports to China. U.S. wine sales to China dropped 25% by volume in 2018, and their value plummeted by a similar margin, hitting just $59 million. As the trade war dragged on, U.S. wine exports to China fell nearly 50% further in the first nine months of 2019.
This collapse in a major growth market like China underscores how quickly a tariff can wipe out years of export gains. While Europe may not be as large an export destination for U.S. wine as China was becoming, a tariff-induced downturn could reverse export growth trends for American wineries and leave them with excess stock and lower global market share.
Other problems for U.S. producers
Beyond direct sales, broader consequences loom for American winemakers. A glut in domestic supply (from wine that can’t be sold abroad) could put downward pressure on prices at home, squeezing margins. Wineries that invested in export strategies would see reduced ROI, and small producers might find it impossible to break into overseas markets under punitive duties. There’s also a strategic issue: if U.S. wines vanish from Europe for a time, competitors will fill the shelf space. Once those slots are lost, it’s hard to win back consumer attention later. In short, retaliation through tariffs could narrow the global opportunities for U.S. wine, reinforcing Europe’s dominance in its home markets and forcing American producers to scramble for alternatives.
Finding New Markets to Avoid Tariffs
Whether you’re a European vintner facing U.S. tariffs or an American winery bracing for EU retaliation, one key strategy is diversifying your export markets. Relying too heavily on a single country (however lucrative) becomes risky when geopolitical tensions flare. By expanding into new regions, producers can mitigate the damage of losing access to one market. Here are several approaches to consider:
- Explore Emerging Wine Markets: Look beyond the traditional U.S.-EU corridor to regions where wine consumption is on the rise. Asia, for instance, has seen booming interest in wine over the past decade. China has grown into one of the world’s largest wine importers (despite recent volatility), and markets like Japan, South Korea, and Singapore have robust demand for quality wines. Notably, recent trade agreements have made it easier to sell into some of these countries. Under the EU-Japan Economic Partnership, Japan eliminated tariffs on European wine as of 2019, leveling the playing field for EU producers.
For U.S. wineries, South Korea’s free trade deal with the U.S. immediately removed a 15% import tariff on American wines, helping U.S. wine exports to Korea grow from $15.8 million in 2012 to $23 million a few years later. Tapping into such markets can compensate for volume lost elsewhere. Producers should research consumer preferences in these regions – for example, South Koreans’ rapidly growing wine culture or China’s taste for red Bordeaux blends – and tailor their marketing accordingly.
- Leverage Trade Agreements and Lower Barriers: Keep an eye on trade policy developments that might open doors to new markets. For instance, the European Union is actively seeking to reduce India’s very high tariffs on wine.
India’s middle class is a huge potential wine audience if import duties come down. Similarly, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and other multinational pacts can create new avenues for export with reduced tariffs or simplified regulations. U.S. producers should watch for any progress on a U.S.-UK trade deal, as the UK (no longer in the EU) is a top wine importing country that could be more accessible in the future.
Target countries where tariffs are low or falling – for example, Canada (which has friendly terms under USMCA) or markets in Southeast Asia that have unilateral low duties to encourage tourism and trade.
- Diversify Distribution in Stable Regions: In addition to seeking booming markets, it’s wise to expand in stable, tariff-safe regions. Within Europe, if you’re a French or Italian producer losing U.S. sales, you might pivot to export more to non-EU European countries (like Switzerland, Norway, or the UK) that aren’t directly involved in the U.S.-EU dispute. Many of these countries have high wine import demand and no new trade barriers on EU wines. American wineries might consider Canada, Mexico, and Latin America as well – markets geographically close to home with existing trade frameworks. While these markets individually may be smaller than the EU, together they can make up a significant share. The goal is to spread the risk: success in 3–4 different export markets can ensure that trouble in one doesn’t cripple your entire export business.
- Adapt and Innovate: In the face of tariffs, some producers may adjust their product mix or packaging to slip under tariff thresholds (as a few European producers did by slightly raising alcohol content to avoid the specific tariff category in 2019. Others might focus on higher-end wines where a tariff’s percentage impact is less noticeable to affluent consumers, or conversely emphasize value wines in untariffed markets. Innovation can also mean finding new channels – for example, directly targeting consumers abroad via online sales (where legal) or building brand presence through tourism and tasting events in tariff-free countries. While these steps don’t replace a major market, they can create new revenue streams to ride out the storm.
In all cases, the underlying principle is agility. Wine producers who proactively seek out new markets and partnerships will be in a stronger position to weather tariff challenges. This is where leveraging global networks and data becomes especially important.
How BestWineImporters Can Help Producers Navigate Tariff Turbulence
BestWineImporters (BWI) has been helping wine producers to find reliable import partners worldwide and maintain stable business for the past 20 years.
It maintains a comprehensive, daily-updated database of wine importers, distributors, and retailers in 170 countries. Producers can tap into contact details for over 28,000 importers spanning established markets and emerging ones alike.
This global reach means a winery in France can just as easily find importers in South Korea or Brazil as in California. When tariffs make one country unprofitable, BWI’s database helps identify alternative partners in tariff-friendly regions, fast.
The platform isn’t just a static list – it offers an advanced search engine to filter importers by country, product type, size, and more. For example, a California producer of boutique Zinfandel can filter for mid-sized importers in Asia who specialize in New World red wines. Or a Spanish cava producer can search for importers in markets with lower sparkling wine duties. This level of targeting ensures that producers connect with importers who are a good fit for their specific wines and business needs, improving the chances of successful partnerships.
Secure Stable, Long-Term Relationships: During geopolitical turmoil, having diverse, stable importer relationships is a lifeline. Producers who use BestWineImporters can establish a presence in multiple markets, reducing over-reliance on any single country. The platform’s breadth means wineries can find importers not just in one new market, but in several – creating a portfolio of partnerships worldwide. This diversification is key to stability: even if a tariff disrupts one channel, revenue from other channels can keep the business healthy.
In an industry as interconnected as wine, knowledge and flexibility are power. Tariffs and trade barriers will always pose challenges, but wine producers have tools and strategies at their disposal. By understanding the potential impacts – from price increases and lost market share to retaliation risks – and by proactively seeking new markets and partners, producers can cushion the blow of geopolitical headwinds. Platforms like BestWineImporters add an extra layer of support, providing the market intelligence and contacts needed to pivot quickly.
