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By Emma Rumney
LONDON (Reuters) - Some $3 billion in tequila and mezcal imports from top makers of the popular spirits, Diageo and Jose Cuervo owner Becle, are at risk from U.S. President-elect Donald Trump's planned tariffs on Mexico, according to Mexican customs data reviewed by Reuters.
Trump, who takes office on Jan. 20, has said he will slap 25% tariffs on imports from Mexico and Canada, as well as additional duties on Chinese goods, which would hit companies in sectors from autos to retail.
These would also drive up the cost of importing spirits that cannot be made elsewhere, such as tequila, which is used in cocktails like margaritas and growing in popularity globally after taking off in the United States, as well as mezcal. Like French champagne or Italian parmesan cheese, products using the names tequila or mezcal must be made in Mexico.
That leaves companies like Diageo, the world's top spirits maker, and Mexican firm Becle, the largest tequila producer, exposed. Together, they dominate the U.S. market for the agave-based drinks, and rely heavily on tequila sales in the U.S. for growth.
Diageo subsidiaries shipped over 25 million litres of tequila from Mexico to the U.S. last year, including brands Don Julio, Casamigos, DeLeon and 21 Seeds, according to Mexican export data provided exclusively to Reuters by ImportYeti.
That equates to a total of 33.7 million 750 millilitre bottles, Reuters calculated. The data references various editions of each brand, from the cheapest 'blanco' versions to far more expensive labels like Don Julio 1942, which sells for $139.99 per 750 ml bottle at large U.S. spirits retailer Total Wines & More, offering the most detailed insight yet into the value of imports exposed to the tariffs.
Based on the prices per 750 ml at Total Wines & More, one of Diageo's largest U.S. customers, the U.S. tequila imports recorded in the data would be worth almost $1.6 billion.
A similar analysis of Becle's U.S. shipments of eight tequila or mezcal brands found they also had a sales value of almost $1.6 billion.
Campari Group, the next largest listed spirits maker with a popular tequila brand in the U.S., sent tequila with a sales value of just $122 million, Reuters analysis found.
Diageo said it had decades of experience navigating trade policy and has always taken trade disputes in its stride. "We will work with the incoming administration on issues that affect our business," it said.
Becle did not respond to requests for comment. Campari declined to comment.
Reuters analysis shows just how much is at stake for top producers that dominate the U.S. tequila and mezcal markets if tariffs come into force. U.S. industry imports totalled $4.6 billion in 2023, up 160% since 2019, according to the Distilled Spirits Council of the United States (DISCUS), which has warned the tariffs would cost jobs.