The French wine industry is facing mounting uncertainty as it awaits key decisions from Washington and Brussels regarding potential U.S. tariffs on European alcohol. Former U.S. President Donald Trump recently threatened to impose a 200% tariff on European alcohol in response to the European Union’s proposed tax on American bourbon. The move, linked to a broader dispute over steel and aluminum tariffs, has already disrupted exports, with many shipments put on hold.
Gabriel Picard, president of the Federation of Exporters of Wines and Spirits (FEVS), highlighted the growing concern among industry stakeholders. “The uncertainty has led U.S. importers to halt shipments, even for containers that were ready for dispatch,” Picard explained. The impact has been widespread, affecting both small-scale producers and major trading firms. The U.S. Wine Trade Alliance (USWTA) has advised its members to suspend imports of European wines, citing the high risk of punitive tariffs.
In response, the European Commission has postponed its countermeasures until mid-April, providing the French wine industry with a critical window to advocate against the tariffs in Paris and Brussels. Picard emphasized that industry leaders have long argued for the exclusion of bourbon, American spirits, and wine from EU retaliation lists. He warned that targeting these products is both politically ineffective and economically damaging, particularly given the trade imbalance. While the EU exports wine and spirits worth €8 billion to the U.S. annually, American wine exports to Europe amount to just €500 million.
The situation remains volatile, particularly with the “America First” trade policy set to take effect on April 2. Picard described the current climate as “an unpleasant moment of uncertainty.” Rodolphe Lameyse, CEO of Vinexposium, warned that a 200% tariff would effectively act as a ban on European alcohol imports. He expressed hope that an alternative resolution could be reached, sparing the wine industry from severe economic repercussions.
Industry leaders are urging caution in negotiating any potential compromises. Philippe Tapie, president of the Bordeaux Négoce wine association, cautioned against accepting lower tariffs of 50% or 25%, stressing that even these rates would be damaging. He noted that past tariff increases had a direct impact on trade volumes, citing the 25% tariff in 2019, which led to a corresponding 25% drop in sales and a loss of approximately $600 million for Bordeaux wine. The first trade conflict with the U.S. cost the French wine industry €1 billion, with no compensation provided.
Michel Chapoutier, head of a prominent wine company in the Rhône Valley, criticized the European Commission for failing to shield the wine industry from the trade dispute. He urged EU officials to take corrective action and prevent further economic harm. The U.S. remains an essential market for French wine exports, with American sales accounting for 10% to 20% of revenues in the Rhône Valley and delivering profit margins as high as 50%.
While China has previously emerged as an alternative market, its demand has proven less stable. Tapie underscored the importance of the U.S. market, highlighting its maturity and deep consumer knowledge of French wines. As trade tensions escalate, the French wine industry remains committed to lobbying for a resolution that safeguards its access to this vital market.
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