Tennessee whiskey distillers are sounding the alarm over the long-term consequences of the trade tariffs imposed by President Donald Trump’s administration. According to industry experts, the ongoing tariff war is threatening not only the domestic spirits market but also the broader hospitality sector.
The U.S. whiskey industry, once benefiting from favorable trade agreements, is now facing retaliatory tariffs that are damaging both domestic producers and foreign relations. As distillers adjust to these economic challenges, the battle over tariffs continues to shift the landscape of global trade.
Impact on Small Craft Distillers
The American craft distillery sector, home to smaller producers who rely heavily on consumer spending at local bars and restaurants, is especially vulnerable to the tariff war. David Suk, CEO of Saint Luna and an American craft distiller, has expressed concern that higher tariffs will result in increased prices for consumers.
Suk emphasized that rising costs could force customers to choose between spending on premium cocktails or basic living expenses, a decision that may ultimately harm distillers who rely on consumer traffic in the hospitality industry.
In particular, smaller distillers who do not have the large-scale distribution networks of big-box retailers may face more severe financial difficulties. The reduced disposable income of consumers could lead to lower sales, thereby threatening the viability of many independent brands.
International Retaliation and Market Consequences
The ripple effects of these tariffs have not been confined to the U.S. In Canada, provinces like Ontario and Nova Scotia took drastic measures by pulling American whiskey brands off the shelves in response to Trump’s tariff policies.
This retaliation has left U.S. whiskey producers like Uncle Nearest Premium Whiskey at a disadvantage, as Canadian retailers are forced to absorb the cost of unsold stock.
According to Fawn Weaver, CEO of Uncle Nearest, the decision is financially detrimental for Canadian liquor stores, who had already paid for the inventory before it was pulled.
The global whiskey market has also been impacted by a 25% tariff on American whiskey imposed by the European Union in 2021. While this tariff was temporarily suspended due to a steel and aluminum dispute, it was reintroduced in April 2025 at a rate of 50%.
This re-imposition poses another obstacle to U.S. whiskey distillers, as it significantly increases the cost of exporting American spirits to one of the world’s largest markets.
In response to these challenges, the Distilled Spirits Council of the United States (DISCUS) has been advocating for the whiskey industry to be excluded from trade disputes.
As Chris Songer, CEO of DISCUS, noted, “Our industry is going to lean in and do our best to encourage all governments involved to really leave this industry be. We don’t deserve or need to be collateral damage,”
Distillers are hopeful that continued domestic support for American brands will help mitigate some of the economic pressures they are facing.
