The US-European Trade Conflict: A Shift from Metal Tariffs to Alcoholic Beverages
The ongoing trade tensions between the United States and the European Union have evolved, expanding their focus from initial tariffs on iron and aluminum to a surprising arena: alcoholic beverages. Recently, US President Donald Trump issued a stern warning regarding a proposed 50 percent tariff on American whiskey, indicating that the United States would retaliate with tariffs on European wines, champagnes, cognacs, and other alcoholic imports.
The impending 200 percent tariff on whiskey is particularly alarming for exporters. It is projected that such a steep demand could completely halt exports of whiskey to the US, rendering it economically unfeasible for even a single bottle to make its way across the Atlantic.
Currently, European alcoholic products account for 17 percent of the US market share. Of this segment, Italian wines command 7 percent, while French wines and cognacs make up an additional 5 percent.
“As for the Champagne market, the US represents 12 percent of our total exports, equating to 600,000 to 800,000 bottles annually. The US market is crucial for maintaining our brand’s reputation,” commented a representative from Titanzhi, a leading Champagne producer in France.
It’s important to note that the US is a significant importer of alcoholic beverages, with import volumes often exceeding exports. Therefore, the imposition of tariffs on these products could inadvertently hurt domestic sellers within the United States.
Historical context reveals that during Trump’s previous tenure, a 25 percent tariff was already placed on certain imports, disrupting market dynamics. With the prospect of a staggering 200 percent tariff, the retail price for certain products, such as a glass of high-end champagne, could escalate to $60.
As it stands, the US alcoholic beverage market is valued at a substantial $175 billion. On March 13, 2025, Trump reiterated his threat to impose a 200 percent tariff on European alcoholic beverages, coinciding with Europe’s recent execution of tariffs on $28 billion worth of US goods—a clear escalation in ongoing trade hostilities.
In response, the United States has also enacted a 25 percent tariff on imports of European iron and aluminum, cementing a tense trade environment that continues to evolve.
