This sign says it all. It’s one of many signs in all stores of the Liquor Control Board of Ontario (LCBO), the provincial government monopoly that controls all importation, purchasing, marketing, sales, and taxation of wine and other alcoholic beverages. The same system and syndrome are true all across Canada’s other provinces: Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Saskatchewan, and Quebec.
In other words, it’s a national boycott of American wine by the largest export market we have, with $1.1 billion of annual sales. And it’s only because of the 25% tariffs the U.S. imposed on many Canadian products.
Export markets take many years and huge investments to build, but can collapse quickly because other nations will fill any gaps. Over 90% of US wine exports are from California, which is feeling the pain first, but it will affect all wineries when the previously exported wines end up on US shelves, creating a glut and depressing prices.
To compound the problem, most Canadians are boycotting the US as a tourist destination, also affecting wineries and other businesses in the hospitality sector like restaurants, hotels, attractions, gas stations, and state and local tax bases. One mid-sized winery in the Finger Lakes region said it would lose about 2,000 visitors and $60,000 in sales, not to mention the losses of neighboring wineries and other regional businesses.
WineAmerica has long opposed tariffs on wine regardless of whether Republicans or Democrats are in power, and all of this illustrates why. We are working with Wine Institute and other partner organizations to help resolve this situation as soon as possible.