The Scotch whisky industry is bracing for a potential £600 million loss in exports as a result of escalating trade tensions initiated by President Trump. On February 1, 2025, Trump announced a 25% tax on shipments from Mexico and Canada, which could have ripple effects across the spirits industry, including Scotch whisky [f948a238]. This follows a series of tariffs that began on October 18, 2019, which led to a 25% drop in Scotch exports to the US, costing the industry over £600 million in just 18 months [f948a238].
The Scotch Whisky Association (SWA) has clarified that these tariffs stem from a long-standing dispute over aircraft subsidies rather than Trump's trade policy. The SWA is actively seeking to collaborate with the US administration to bolster trade links and mitigate the impact of these tariffs [f948a238].
In addition to the tariffs on American spirits, the potential for further tariffs on EU and UK products looms large, threatening to exacerbate the situation for Scotch exports. Canadian Prime Minister Justin Trudeau has also announced retaliatory duties on $30 billion of trade in North American alcohol and fruit, effective February 3, 2025, which could further complicate the export landscape for Scotch whisky [f948a238].
As the industry navigates these turbulent waters, the expiration of a five-year suspension on 25% tariffs in June 2026 poses another significant threat to Scotch whisky producers, who are already grappling with the repercussions of previous tariffs and the changing dynamics of international trade [f948a238]. Meanwhile, the Kentucky Distillers' Association (KDA) continues to voice concerns about the impact of tariffs on American whiskey, which could also be affected by the broader trade war [7fe24e95].
The combined effects of these trade policies could reshape the spirits industry, impacting production, pricing, and employment across the board, particularly for craft distillers who are also facing potential tariffs on American whiskey exports to Europe [b4a551b3].