Jamie Spencer
U.S. spirit exports surged to a record $2.4 billion in 2024, bolstered by the lifting of retaliatory tariffs and ongoing global trade disputes, according to the American Spirits Exports report from the Distilled Spirits Council of the United States (DISCUS).
Impact of Tariff Concerns on U.S. Spirits Exports
Chris Swonger, President and CEO of DISCUS, highlighted that U.S. spirits exports hit new highs, regaining market share lost during the tariff battles between 2018-2021. However, ongoing trade disputes unrelated to the spirits sector continue to create uncertainty, with many U.S. distillers hesitant to expand operations due to this volatility.
Surge in Exports to the European Union
Exports to the European Union saw a significant increase of 39%, fueled in part by fears over a potential return of a 50% tariff on American whiskey imports in 2025. This tariff had been suspended in 2022. The U.S. and EU continue trade negotiations, which have alleviated some of the tariff-related concerns.
In March, U.S. President Donald Trump threatened to impose 200% tariffs on French Champagne and other EU spirits, prompting European leaders from Ireland, France, and Italy to advocate for the preservation of bourbon’s tariff status. Despite the growing tensions, the specific tariff threat on American whiskey has since receded.
Key Export Markets and Decline in Other Regions
The EU remains the largest export market for U.S. spirits, with $1.2 billion in exports, comprising approximately 50% of all U.S. spirit exports. However, exports to other global markets declined by nearly 10%, a trend that reflects broader challenges within the alcohol sector.
Challenges and Strategic Responses from U.S. Companies
Suntory Beam, the Japanese maker of Jim Beam, has been proactive in preparing for potential tariff impacts by stockpiling supplies in Europe. The company, which relies heavily on France and the UK, faces significant tariff risks, with these two countries representing over 50% of its global exports in the past eight years.
Top U.S. States for Spirits Exports
Several top U.S. states are key players in the spirits export sector, with the following states seeing the highest export values in 2024:
- Tennessee: $934 million
- Kentucky: $751 million
- Texas: $354 million
- Florida: $334 million
- Indiana: $142 million
Despite the strong export numbers, American whiskey exports, which account for 54% of all U.S. spirits exports, fell by 5.4%, totaling $1.3 billion. This decline is attributed to the broader global economic headwinds and uncertainties in international trade.
Looking Ahead: Opportunities and Challenges
Swonger emphasized that while the outlook for U.S. spirits remains unpredictable due to the ongoing tariff concerns, the data shows a clear trend: exports thrive in countries that have eliminated tariffs. He praised President Trump’s efforts in securing a reduction of tariffs on bourbon in India, from 150% to 100%, and expressed hope that the administration will continue to reduce trade barriers in other regions.
However, challenges persist. Canada, the second-largest market for U.S. spirits exports, imposed a 25% tariff on alcohol in March, leading to disruptions in product availability across several provinces. U.S. distillers are also facing higher costs due to steel and aluminum tariffs, which are impacting materials for brewers like Constellation Brands, who have adjusted their long-term guidance due to anticipated tariff impacts.
