I, of course, am against tariffs and boycotts on products like wine and all products where it is targeted ‘just because.’ The current environment and China’s latest Tariff’s on US products affects people producing these products. And yes it is not just out of the blue it is in response to the US’s tariffs on steel and now 1,300 Chinese produced products. As I write this I am sure this is not going to suddenly get better.
I think when wine is targeted it is not thought of as people who produce it versus an emotional tug to get a reaction. While 15% tariff may not seem to be high but it can currently shift other wine producing countries wines ahead. According to the Wine Institute of California the current tax on a bottle of US wine in China is 48.7% and a 15% tariff would increase to 67.7%.
If US wine is perceived as expensive and there is an alternative for a lower price/high quality wines from Australia and Europe then consumers will do that. For US producers and that is mainly west coast wine state producers of California, Oregon and Washington accounts for most of the wine exported to not just China but around the world. There have been many US wine producers who have worked exceptionally hard to cultivate their market in China and if this prolonged tit for tat continues US producers have their work cut out for them. Again when specific products are targeted there are always people behind them that depend on their livelihood.
I was watching NBR (Nightly Business Report) and a banker thought the trade war tensions wouldn’t last long and the harm would be minor. But for many products not just wine; items are sold with great effort and promotion. Getting people to re-engage is of course an almost re-starting position for US wine producers.
I also reported recently on the wine ban of BC wines in the province of Alberta (Alberta’s Two Week Boycott of BC Wines). The issue was not about wine at all it was to gain leverage on an energy pipeline. Luckily this “ban” didn’t last long. And this ban had nothing to do with wine–so sad this happens within a country.
I am against all bans and trade wars–no one truly wins them. Negotiation and trade deals are important and benefit all participants. Also a trade deal or treaty is not just a singular event but negotiation and active management is required over time.
James the Wine Guy
Demystifying Wine…One Bottle at a Time from all wine regions around the world.
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