US Spirits Exports to Canada Suffer 63% Decline Post-Trump Tariffs
A year after President Donald Trump announced steep tariffs on Canada, exports of American spirits including Kentucky bourbon to the northern neighbour have collapsed by more than 60 percent. The dramatic downturn highlights the lasting impact of trade tensions between the two nations.
Retail Shelves Remain Empty Across Most Provinces
According to the Distilled Spirits Council of the United States (DISCUS), stores in eight out of ten Canadian provinces continue to refuse stocking American alcoholic beverages. Only Alberta and Saskatchewan currently offer US spirits to consumers, representing a significant reduction in market access for American distillers.
The tariff war began in March 2025 when Trump imposed 35 percent tariffs on Canada, despite ongoing legal challenges questioning his authority to implement such measures. The Supreme Court ruled last month that the International Emergency Economic Powers Act does not permit his wide-ranging tariff strategy, yet the president has maintained his position.
Canadian Retaliation and Lasting Market Damage
Canada responded swiftly with its own 25 percent tariff on all US alcoholic beverage imports. Although this retaliatory measure was lifted in August 2025, consumer behaviour has not recovered. Many Canadian retailers pulled American products entirely following the initial tariff announcements, creating lasting disruption to established trade patterns.
DISCUS data reveals that Canadian imports of American whiskey, including bourbon, plummeted from $203 million in 2024 to just $60 million in 2025 between March and December. Full-year exports from the United States to Canada in 2025 decreased by nearly 63 percent overall.
Industry Leaders Voice Concern Over Trade Relations
Chris Swonger, president and CEO of DISCUS, expressed deep concern about the situation. "One year after US spirits were removed from retail shelves across Canadian provinces, the damage to American distillers is unmistakable," he told the Louisville Courier Journal. "This policy has caused real and avoidable harm to an industry that has long championed open markets and zero-for-zero tariffs with our major trading partners."
Swonger emphasized the council's desire for both nations to resume negotiations toward eliminating tariffs permanently. "We deeply value our Canadian consumers, who have embraced the quality and diversity of American spirits for decades. We urge both governments to come back to the table to restore permanent tariff-free trade and restore Canadian consumers' access to these iconic American spirits," he stated.
Political Tensions Complicate Resolution
Reaching a diplomatic solution may prove challenging given ongoing political friction. Trump has repeatedly made controversial statements about Canada, including suggesting the country should become part of the United States. He has referred to Canada as America's "51st state" and called former Prime Minister Justin Trudeau the nation's "governor."
Prime Minister Mark Carney has firmly rejected such notions, declaring that "America is not Canada, and Canada never, ever will be part of America in any way, shape or form." Despite these public disagreements, Carney noted that Trump presents differently in private discussions, allowing the leaders to "work through things," though he acknowledged that "it's not easy, let's be clear."
Trade Imbalance Grows as Canadian Imports Increase
While American spirit exports to Canada have dramatically declined, imports from Canada to the United States have increased by nearly 11 percent, representing $691 million worth of products. This growing trade imbalance further complicates the economic relationship between the two nations.
The situation remains fluid, with industry representatives hoping for renewed negotiations that could restore the previously robust trade in distilled spirits. However, with political tensions persisting and market habits fundamentally altered, recovery may prove slow even if tariffs are eventually lifted completely.
