Retaliatory Tariffs May Impact 'Close To Half Of US Spirit Exports'
A U.S. spirits trade body said on Thursday that as much as 46% of global spirits exports from the United States could be at risk of facing retaliatory tariffs, following President Donald Trump's move to impose tariffs on steel and aluminum imports.
An estimated $759 million worth of spirits exports are the target of tariffs from the country's trading partners, which, if imposed, would severely harm producers, farmers and industries associated with the spirits business, the U.S. Distilled Spirits Council said in a letter to Commerce Secretary Wilbur Ross.
The trade group estimated that 65 percent of global U.S. whiskey would take a hit if the European Union, Canada, Turkey and/or China retaliated.
"The imposition of tariffs on these products by our major trading partners threatens to seriously impede the export progress that has benefited our sector and created jobs across the country," Clarkson Hine, interim president and chief executive officer of Distilled Spirits Council said in a letter.
The United States has placed a 25 percent tariff on steel imports and a 10 percent tariff on aluminum imports from countries including the EU, Canada, Mexico and China.
In response, Mexico on Tuesday imposed tariffs on American products ranging from steel to pork and bourbon.
The trade body represents companies such as Diageo PLC , Pernod Ricard SA and Brown-Forman Corp .
Earlier this week, Jack Daniel's maker Brown-Forman said that it had been working hard to mitigate the impact of potential tariffs on US drinks products.
Jane Morreau, the company's chief financial officer noted that the company has "been watching the developments very closely as the situation remains fluid and there is great uncertainty around what retaliatory measures, if any could be implemented on what starting when at what rate or for how long."
The company said that reported sales were 6% higher in the fourth quarter, with the Jack Daniel’s family of brands posting an 8% gain over full-year 2018.