In This Article:
President Trump has threatened a 200% tariff on European wine and alcohol as a potential countermeasure to the European Union's (EU) own retaliatory tariffs against the US.
Yahoo Finance senior retail reporter Brooke DiPalma explains how the industry is reacting to the series of tariff spats between the US and European officials.
To watch more expert insights and analysis on the latest market action, check out more Market Domination here.
Well, you might need to say goodbye to some of your favorite adult beverages. President Trump took to Truth Social to threaten a 200% tariff on European wine, champagne and other alcoholic products if the EU did not remove a 50% tariff on American whiskey. Joining us now, Yahoo Finance's Brooke DiPalma to talk to us about what, again, it's just a threat. It's not in effect yet. But how should we think about this? I mean, we buy a lot of booze from Europe. They probably buy a lot of booze from us, too.
Just a threat. Right. They buy a whole lot. In 2024, US actually imported $5.4 billion of wine from the EU, $1 billion of beer and $3.5 billion of spirits. When you take this all together, it's roughly $10 billion worth of alcohol imports from the EU. Now, Needham and Company analysts told Yahoo Finance that a tariff, a potential tariff, that is, of a caliber of 200% would essentially eliminate imports of these types of products. He said, quote, "A company is not going to ship it on a 200% tariff. It increases the likelihood that you're going to get a global trade war with collateral damage and that's not going to be good for the sector." Now shares of Pernod Ricard are falling today based upon this potential threat that President Trump took to social media touting. Now, the company did refer, that's Pernod Ricard did refer to a trade group statement that spirits Europe, he said, or rather the company, this trade group said that it is deeply alarmed by the renewed threat of tariffs on EU and US spirits. Once again, it said that it's being a part of an entirely unrelated dispute. Now, this trade group, Spirits Europe went on to say the cycle of tit-for-tat retaliation must end now. Now, to be clear, the tariff on American whiskey to the EU is still set to go into effect on April 1st as part of that retaliation for US putting a 25% tariff on steel and aluminum. And a spokesperson from Brown-Forman did tell Yahoo Finance that they're pleased that the European, uh, EU president and trade commissioner expressed a desire to negotiate with the US and hoping that they do come to this resolution by April 1st. Of course, that is looming rather quickly, but they went on to say that this tariff conversation is much bigger than just one company. It is a multitude of different companies that are really going to be hit by these potential tariffs.
It's going to be really interesting to see what wine sales look like over the next month or the next couple of weeks. I mean, 200%? The analyst that I spoke to said that there could be like a stockpile, like I mean, people might be rushing to the store as we chat right now just to get their hands on that already very expensive French wine and champagne.
It's not all that expensive. Worth it, maybe. I mean, it doesn't go bad. Exactly. Yeah.
Thank you, Brooke. Appreciate it.
