You may need to say goodbye to your favorite champagne and cognac.
Imported wine, champagne, and other alcoholic products from the European Union are the latest targets of President Trump’s tariff threats.
On Thursday morning, President Trump posted on Truth Social that if the EU didn’t remove a 50% tariff on whiskey, the US would place a 200% tariff on wine, champagne, and other alcoholic products. The whiskey tariff, set for April 1, is part of retaliation for the US putting a 25% tariff on steel and aluminum.
If it goes into effect, the whopping 200% tariff could «essentially eliminate» imports of these types of products in the United States, Needham & Company analyst Gerald Pascarelli told Yahoo Finance.
«A company is not going to ship it on a 200% tariff,» Pascarelli said. The duty also «increases the likelihood that you’re going to get a global trade war with collateral damage, and that’s not going to be good for the sector,» he added.
Read more: What Trump’s tariffs mean for the economy and your wallet
At close: March 13 at 4:00:54 PM EDT
BF-B RI.PA DEO
Year to date, shares of American whiskey maker Brown-Forman (BF-B), the world’s second-largest wine and spirits seller Pernod Ricard (RI.PA), and scotch and spirits maker Diageo (DEO) have dropped 8%, 11%, and 15%, respectively.
A spokesperson from Brown-Forman told Yahoo Finance, «We are pleased that [European Union] President von der Leyen and Trade Commissioner Šefčovič expressed a desire to negotiate with the U.S. and are hopeful the two sides will reach a constructive resolution before the tariffs take effect on April 1.»
«The tariff conversation is bigger than Brown-Forman and our industry, and it’s evolving rapidly,» the spokesperson added.
Brown-Forman said it’s «working closely» with spiritsEurope and the Distilled Spirits Council of the United States. LVMH, which owns champagne brands Moët & Chandon and Veuve Clicquot, did not immediately respond to request for comment.
Pernod Ricard referred to a statement from spiritsEurope. The trade group said it’s «deeply alarmed by the renewed threat of tariffs on EU and US spirits — once again, as part of an entirely unrelated dispute. This cycle of tit-for-tat retaliation must end now!»
«Spirits trade exemplifies how open markets create mutual benefits. Reimposing tariffs would be a step backward — hurting businesses, workers, and consumers on both sides,» the group added.
In 2018, the EU imposed a 25% tariff on American whiskey as part of retaliatory tariffs during the first Trump administration’s steel and aluminum tariffs. Given this gives a sense of déjà vu, Pascarelli said the valuation of Brown-Forman shares may have already priced in the risk of tariffs.
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