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U.S. Wine Industry Faces Crisis as Canadian Boycott and Tariffs Hit Hard

Sweeping tariffs and Canada's retaliatory measures have disrupted exports, raised production costs, and deepened uncertainty for American winemakers.

Wine tariffs
A worker removes bottles of American-made wine from a shelf at the Liquor Control Board of Ontario (LCBO) Queen's Quay store in Toronto, Ontario, Canada, on March 4, 2025.
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Overview

  • Canada has fully removed U.S. wines from store shelves and restaurants, leading to a 20% drop in Canadian sales for some producers and $1 billion worth of unsold wine stranded in the market.
  • The Trump administration's 145% tariffs on Chinese glass bottles and 10% duties on European barrels and corks have significantly increased production costs for American wineries.
  • Canadian provinces' united boycott of U.S. alcohol has eliminated access to the industry's largest export market, which previously generated over $1.1 billion annually in sales.
  • Frequent and unpredictable tariff announcements have created planning challenges for wineries, complicating pricing strategies and supply chain management.
  • Producers warn of long-term damage to the U.S. wine industry, which was already struggling with post-pandemic consumption declines, inflation, and competition from alternative beverages.