The American spirits industry's roaring '20s has turned to a whimper.
The latest report released by the Distilled Spirits Council of the United States (DISCUS) reveals that after a record-breaking 2024 for exports, sales to the European Union, Canada, the United Kingdom, and Japan sharply declined in the second quarter of 2025 amid Trump's trade war and backlash to American products. Overall, U.S. spirits exports to the globe dropped 9 percent year-over-year in the second quarter.
"This new data is very troubling for U.S. distillers," said DISCUS President and CEO Chris Swonger. "Persistent trade tensions are having an immediate and adverse effect on U.S. spirits exports. There's a growing concern that our international consumers are increasingly opting for domestically produced spirits or imports from countries other than the U.S., signaling a shift away from our great American spirits brands."
The markets mentioned above represent 70 percent of the total value of U.S. spirits exports, with shipments to the E.U. dipping 12 percent, to the U.K. falling 29 percent, and to Japan dropping 29 percent. The most dramatic fall has been to Canada, which plunged 85 percent in the second quarter.
The American wine industry has felt a similar impact when it comes to trading with America's neighbor to the north. Wine exports to Canada have plummeted by as much as 97 percent year over year. Tensions between the countries began not long after President Trump took office. While the President's new tariff regime sparked a trade war that has some Canadian provinces banning American alcohol, it was the President's remarks about making Canada a 51st state -- which have since been walked back by administration officials -- that really riled up the country. In response, a "buy local" movement emerged in Canada that encouraged people to not purchase goods from America. And even though retaliatory tariffs have been lifted, some Canadian provinces have left their American alcohol bans in place.
This trade kerfuffle has come at the worst time for the U.S. spirits industry, as it has become increasingly reliant on international markets to bolster its revenues. American consumption is down and stocks of U.S. spirits are high as a result, causing many distilleries to halt production recently with fewer people purchasing around the world. So if the 2024 banner export year proves to be an outlier for U.S. brands, then more production freezes and layoffs could be in the industry's future.
"With domestic demand slowing, it is critically important that U.S. distillers have the certainty of zero-for-zero tariffs with our key markets, including the E.U. and U.K.," Swonger said. "The spirits sector is highly interconnected and, as a result, tariffs on imported spirits have wide-reaching consequences on the industry as a whole."