EU Tariff Causing Significant Slump In American Whiskey Exports: DISCUS

EU Tariff Causing Significant Slump In American Whiskey Exports: DISCUS

February 13, 2020

The Distilled Spirits Council of the United States (DISCUS) expressed concern over drastic fall in American whiskey exports to the European Union as a result of retaliatory tariffs imposed by the 27-nation bloc.

American whiskey exports to the European Union, which is the largest foreign market of U.S. spirit, decreased by 27 percent in 2019, DISCUS revealed in its annual economic report. This is based on data released this week by the U.S. International Trade Commission.

Global exports of American whiskey have declined 16 percent in 2019 from 2018, and global spirits exports are down 14.3 percent over the same period.

The devastating impact of the EU’s 25 percent tariffs on distilled spirits products is accelerating, threatening to upend the decade of growth in the U.S. spirits sector, the industry group said.

“These tariffs are chipping away at American whiskey’s brand equity in our top export markets. These great American Whiskey products that have been the toast of the global cocktail scene are struggling under the weight of the EU tariffs,” said DISCUS President and CEO Chris Swonger in a press release.

However, the domestic market is giving a different picture. In the United States, supplier sales were up 5.3 percent in 2019, rising $1.5 billion to a record total of $29 billion, while volumes rose 3.3 percent to a record 239 million cases, up 7.6 million cases from the previous year.

DISCUS Chief Economist David Ozgo said the strongest revenue growth in the U.S. spirits market in 2019 continued to come from high-end premium and super premium products.

In 2019, spirits gained a market share of 37.8 percent of the total beverage alcohol market, versus beer and wine. This is the 10th straight year of market share gains for spirits overall, where each point of market share is worth $770 million in supplier sales revenue.

Swonger said the U.S. spirit industry is seriously concerned that the U.S. tariffs on EU spirits imports will have the same deleterious effect in the United States. He warned that if this trade dispute is not resolved soon, it is more than likely that the U.S. spirits sector’s solid growth in the U.S. market will be stalled and many jobs affected.

EU countries such as the UK, France, Germany and Spain also suffered major export declines.

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