U.S. Spirits Exports Plummet Amidst Ongoing Trade Disputes
Exports of U.S. distilled spirits, including American whiskey, experienced a significant downturn in the second quarter of 2025, largely attributed to sustained trade tensions with key international partners.
Globally, U.S. spirits exports fell by 9% compared to the same period in 2024, representing a loss of $57.4 million for American distillers, according to a recent report from the Distilled Spirits Council of the U.S. (DISCUS). The declines were particularly sharp in crucial markets like the European Union, the United Kingdom, Japan, and Canada, with Canada experiencing an 85% decrease in imports of U.S. spirits. This drop in exports comes after a record-breaking 2024, where over $2.4 billion worth of spirits were exported from 43 states.
The most dramatic impact has been felt in Canada, where retaliatory tariffs previously blocked the sale of U.S. spirits, including Kentucky bourbon, in many provinces. While Canada recently removed these tariffs, second-quarter exports to the country fell below $10 million. Simultaneously, the Liquor Control Board of Ontario reported a 23% year-over-year increase in sales of Ontario-made products between February 9 and September 6, including a 4.5% rise in Ontario-made spirits. “Buy Canadian” movements are gaining traction as consumers seek alternatives. U.S. Representative Morgan McGarvey stated, “In a state like Kentucky, we’ve known from the start that Trump’s sloppy tariff policies would hit us hardest…Trump should come tell Kentucky farmers…why his ego-driven trade war is worth sabotaging their job security.” The situation highlights the vulnerability of the U.S. spirits industry to international trade policies.
American whiskey, encompassing bourbon, saw a 13% global export decrease, equating to a $40.5 million loss in the second quarter. DISCUS also noted that the American whiskey category is facing stagnating domestic sales alongside record-high inventory levels, currently at 1.5 billion proof gallons. The continued trade disruptions could lead to increased financial strain for U.S. distillers, impacting a significant sector of the American economy; Kentucky alone exported over $750 million in spirits abroad in 2024. You can learn more about the impact of tariffs on the U.S. economy here.
Officials warn that continued trade-related disruptions could further erode export volumes, potentially leading to mounting pressure and financial strain for U.S. distillers.
