“Wine social media” — that being the expansive online community of wine writers, importers, makers, winery owners, etc. — has been abuzz for weeks now about the 100% tariffs that are being proposed on European wine, along with other agricultural products, including cheese. Almost to a person, the wine industry is against these tariffs, regardless of whether or not the person is part of the European wine community, the wine industry in the United States or from somewhere else.
But there is also a vocal minority — always from the U.S. — that thinks the tariffs, should they come to fruition, might actually be good for American wineries. The thinking goes that if European wines are suddenly much more expensive than they have been, consumers of those wines could spend a greater percentage of their wine budget on wines made right here in the United States.
On the surface, this idea makes a lot of sense. But as with many things, this — and the wine industry as a whole — is much more complicated than that. It isn’t as simple as a winery making a wine and me or you buying that wine.
To try to understand the potential impacts, I spoke with a few folks in the wine industry: a couple of winery owners, the general manager of a local winery, a wine shop owner and the vice president of an advocacy group focused on American wineries.
“The intention of tariffs is to promote domestic products over imported ones. To level the price-point playing field when imported products can be made much cheaper,” said Anthony Nappa, winemaker at Raphael and owner of Anthony Nappa Wines. “We have never been able to compete on price here on Long Island, so we have always focused on competing in quality. An argument could be made on both sides that a more competitive product will increase sales. But with easing price pressure there could be a reduction in quality focus.”
Suellen Tunney, general manager of McCall Wines, seems to think that any local benefit would be very near-term. “In the short term, perhaps there will be an increase in American wine sales, because they won’t have the price increases that the European wines would have,” she said. “But again, this is for a very short period of time.”
Nappa isn’t so sure. He told me in an email: “I do not personally think there will be much of an impact on us with an extended tariff in place. Long Island wines, in general, are competing on the super premium to ultra premium price points of $20-$40 a bottle. I would think that the very low end of the market with wines under $10 bottle would be the ones most impacted. Also, these tariffs are only on Europe, not the world. The intention is to hurt farmers in Europe, while the very cheap South American or Australian wines will still fill the supermarket shelves.”
I think that’s an important point. People used to buying and drinking $10 Italian wine aren’t going to start buying $30 Long Island wine because the prices are more similar. They are going to start drinking $10 Chilean wine or something similar from a region without these tariffs.
The bigger issue — for me and for several of the people I spoke to — is how the wine world will be impacted beyond the winery-consumer transaction. There are a lot more people and livelihoods involved. An entire industry that could be changed forever.
George Eldi, owner of Wines by Nature in Wading River, seems uncertain as to what these tariffs might do to the industry longer term. He told me: “I don’t see any importer bringing in wine that now has a 100% increase in cost. If they do decide to pay the increase, I will not and we will seek to find similar profiles and prices from other regions around the world, as well as local options. This is a simple choice, as there is no choice; the market cannot bear this type of increase.”
Remember that complexity I mentioned earlier? Here is how Michael Kaiser, vice president of WineAmerica, sees the impact of these tariffs rippling through the wine industry should the tariffs be implemented: “In the short term, the people that will be impacted first are the boutique importers and wholesalers that bring in wine from smaller European producers. If virtually all of their imported products all of a sudden double in price, that will be quite crippling. Then you will see impacts move to the retail sector. If importers and wholesalers stop bringing in products or have to go out of business, the retail shops and restaurants will lose that product, too. You can’t just replace the European wine with wine from another region. Then the impact will hit domestic wineries. A small American winery that uses the same wholesaler that just went out of business because they lost all their European accounts will be out of luck. Or in states with franchise laws, if your wholesaler is underperforming it’s really difficult to switch. So domestic wineries that sell primarily out of their tasting rooms and maybe on their websites won’t see much impact at all, but domestic wineries in distribution and in restaurants will see a hit.”
Of course, there is one important question to consider as well: Will the tariffs even happen? American tech companies really want them, but there isn’t really a way for us to know for sure. Lenz Winery owner Peter Carrol doesn’t think they will happen. “Trump’s style is to get someone’s attention by delivering a whack around the head with a 2-by-4 and then negotiate a solution. Same here, I think,” he told me.
Kaiser said: “It’s difficult to say right now if they will be implemented. The Trump administration has issued tariff threats on other things and not implemented them. The public comment period is open until [Jan. 13] and if you go read the comments you can see that public opinion is not in favor of implementation.”
It’s important to remember that this isn’t just large corporate entities that could be affected by these tariffs. It’s the smaller companies. It’s the people. That’ who I think about when I think about the impact these tariffs could have.
“The wine world is what my husband and I have built our livelihood on,” said Tunney. “We are incredibly fortunate to sell wine for a living. We are not saving lives, we are not curing diseases. We are, however, part of a larger community of growers, passionate winemakers, artisans. Winemaking is a tradition that goes back thousands of years and has a fascinating social history. If indeed these tariffs do go into effect, all of these people will be at risk of losing their livelihoods as well.”
Lenn Thompson has been writing about American wine — with a focus on New York — for nearly 15 years. After running newyorkcorkreport.com for 12 years, he launched thecorkreport.us in 2016 and The Cork Report Podcast soon after. He lives in Miller Place with his wife and two children.