The California Wine Industry is torn by Trump’s rates

From LevagsCalmness

This story was originally published by CalmattersS Register about their ballots.

Tariffs for European wine can be good or bad for wine producers in California, depending on who you ask.

Some US winemakers, restaurateurs and others call on President Donald Trump to exclude wine from tariffs for goods from Europe, saying that European wines are important for the health of domestic wines.

But not all wine producers in California are on board. They claim that European winemakers are already subsidized, so US companies have to carry tariffs for almost everything else-inferiorly imported plugs, barrels and other supplies-make wine producers in high prices California in an even bigger drawback.

For some wine producers, “it is certainly difficult to hear” for other wine and hospitality players in the United States who insist on rates for zero zero of European wines, said Natalie Collins, President of the California Wine Produce Association, which has 650 members. She said it was difficult for California winemakers to appreciate their products to compete with those from Europe.

Trump has recently said he has reached a tariff agreement with the European Union, but some details have not yet been published, including possible exceptions. For now, the EU says 15% tariffs that came into force in early August Negotiations are reported to continueS The American wine industry that faces countless challenges including New studies that say alcohol is bad for people’s healthFalling demand and increasing costs uses this opportunity to seek help.

“We have seen two years in a row to reduce the consumption of wine in the United States for the first time for two generations,” says Jason Haas, co -owner of the Tablas Creek vineyard in Passo Robbles. “This is shown in less tourism, fewer people visit wineries, fewer people order over e-commerce, fewer sales through wholesalers, both restaurant and retail,” Haas added.

This is the ecosystem that the American wine trade and other industrial groups say they will feel the pain if European wine prices rise due to tariffs: thousands of importers and wine distributors, tens of thousands of wine traders and hundreds of thousands of restaurants. California, the leader of the nation in tourism and exports associated with wine, may be most affected. Wineamerica, an industrial group, said the wine industry in California generated about $ 88 billion economic impact in 2022. Exports of state wine in 2022 amounts to $ 1.3 billion, according to the California Department of Food and Agriculture.

Katie Lazar runs 45-year-old Cain Vineyard & Winery in St. Elena in the Napa Valley.

“We are a long -term business,” Lazar said during a recent briefing in the media, with the echo of what other winemakers said about how growing grapes and wine made years. “It takes (the wine industry) so long to respond and to be able to change that the chaos present now is an existential threat to the world we live in.”

Winemakers like Lazar say that the distributors they rely on to sell their wines need revenue from selling European wines. Their ability to distribute homemade wine is bound by how much wine they enter, she said in an interview with Calmatters.

Most of the alcohol industry in the United States has a three-tier structure that dates from the cancellation of the ban. Winemakers and producers are the first level, followed by distributors and retailers. All three face the uncertainty caused by tariffs: some wine imports have been detained, which means less revenue for distributors and retailers.

“I have never felt as interconnected as I feel now, even with competitors,” says Mat Likidder, owner of LiOCO at Healdsburg, a winemaker who drains his grapes from various small vineyards in California. He said his winery is sold to 40 distributors, some of which they do not know if they will have revenue coming from imports because of the unknown around the tariffs. So some of these distributors order less than it. “He put the distributors in more conservative thinking, which is of no benefit to anyone here,” Liklider said.

For restaurants that have very thin margins, marking certain items such as wine can help them survive. Licklider said over the years he has seen restaurant markings crossing from two to three times to five times a price per bottle of wine.

Paul Einbund, owner of two restaurants in the bay area, said that “many of my dinners just won’t drink home (wine).” But he lists some American wines along with European wines at Maurice, his restaurant in San Francisco and Siren, his new restaurant in Oakland.

Not knowing what will happen afterwards is the biggest part, said Einblund, especially for small businesses, which depend on trying to buy their products at the most possible prices.

“People up and down the supply chain are in difficulty,” he said. “We received emails that said that before tariff prices, but that has dried now. European producers are not sold to Americans right now. European buyers are not buying American wines right now.”

But Richard Samra, who has grown grapes in the Delta of Sacramento and Lodi for 40 years, said he was more worried than selling her grapes to home wineries. He said it was “amazing” that some of the wine industry wants competition tariffs.

He said the competition received a lot of help. The European Commission Recently approved $ 5.6 billion To support the exports of French wines and spirits to the United States, the European Union spends more than € 1 billion a year to help enhance European wine, and some countries have their own subsidy programs.

“Grape manufacturers in the US do not have this,” Samra said.

“We want to equalize the playing field. We have many grapes and wine offered for sale,” Samra added. He said they were tens of thousands of acres of vines Downloaded to California when supply supply exceeds demandAnd he expects this to continue to grow. He said import is a major factor: “Profit margins for people are more bigger when they buy a product outside the US and sell it here.”

Still, screwdrivers such as Haas, in Passo Robbles, said he was also worried about the relationships he has grown for years and how they have been affected by tariffs. Tablas, his winery, lost the entire business in Canada this year.

“There are certainly the effects of transfusion with respect to other countries that are just less willing to support American products because they feel they are harassed,” Haas said.

Tablas only exports about 5% of what it produces, but Haas wanted to grow this year. “Last year, we made a lot of investment and built export markets,” he said. “And so to be downloaded this year instead of upward, it was certainly a hit for us.”

This article was Originally Published on CalMatters and was reissued under Creative Commons Attribution-Noncommercial-Noderivatives License.