The Boozy Edition — Tariffs, Immigration, and the Spirited Shake-Up
Raise your glass — but maybe don’t fill it too fast, because this week’s global trade headlines are giving the alcohol and beverage sector a serious hangover.
USA’s New Tariffs: A Shot of Extra Costs
The U.S. government has slapped on fresh tariffs—ranging from 10% to 25%—targeting imports critical to the beverage world:
- Fine wines from France, Italy, and Spain
- Craft beer equipment and ingredients from Germany and Belgium
- Spirits and distilling machinery from the UK and Japan
- Aluminium cans and bottling materials from China
For months, many distilleries and importers buffered consumers by stocking inventory, but the hangover is here: increased costs are now making their way to your bar tab.
U.S. Industry Sours: Bourbon and Job Cuts
It’s not just imports feeling the pinch. The iconic American bourbon industry—which accounts for over 95% of the world’s bourbon production—is hurting too. Rising costs of aluminium barrels and mash ingredients (corn tariffs have crept up) plus supply chain snarls have forced some distillers to lay off hundreds of workers in Kentucky and Tennessee. One major distillery reported a 15% cut in workforce in early 2025, citing “unpredictable trade policies and supply chain disruptions.”
As bourbon prices rise, bars and retailers tighten orders, further squeezing the industry.
Labor Shortages: The Workforce is Drying Up
Like restaurants, distilleries and breweries rely heavily on immigrant labour for production and skilled craftsmanship. New immigration restrictions have cut seasonal and permanent worker availability by about 30%, causing staffing shortages, overtime costs, and slower production lines.
Global Players: Countries Making Their Moves
While the U.S. struggles, other nations are shaking up the global beverage scene:
- Canada has signed trade deals boosting exports of craft beer and sustainable beverage technology, tapping into European and Asian markets eager for “green” drinks.
- Brazil is expanding tropical fruit juice and cachaça exports with new partnerships in China and South Korea, riding a wave of growing Asian demand for exotic spirits.
- China and Australia have quietly eased some tariffs and trade restrictions on wine and barley, signalling a thaw in their trade spat, with Australia eyeing Chinese consumer markets hungry for premium wine and craft beer.
- Mexico is leveraging its tequila industry through enhanced trade deals with the EU and Asia, capitalizing on growing global appetite for authentic spirits.
- South Africa has negotiated new deals for its wine and craft beer industries to access the UK and EU markets post-Brexit, seeking fresh footholds abroad.
What This Means for You
The next time you grab a craft beer or a bourbon cocktail, remember: behind that glass is a complex cocktail of tariffs, labour woes, supply delays, and shifting global alliances. Prices are creeping up, choices may narrow, and the time it takes to get your favourite spirit is stretching out.
In short: global trade’s got the beverage industry doing the limbo — how low can prices go before your wallet feels the squeeze?