15 Apr Wine Industry Alert But Not Alarmed At Tariffs
The Australian wine industry will inevitably feel some impact from Trump’s 10% tariff however, they are more favourably positioned when compared to other wine markets such as those within the European Union who have been hit with a 20% tariff or South Africa who has attracted a 30% tariff.
Nevertheless, with America the third-largest country for exports of Australian wine, there is concern about the potential decline in consumer demand which may result due to the financial impact of Trump’s tariff scheme on US household budgets. This reduced demand and expenditure will highlight the need for Australian wine brands to remain competitively priced with US-produced wines in order to maintain market share.
Whilst there are also concerns about this tariff amplifying Australia’s current oversupply situation, as well as the fact that this tariff will also be magnified by the USA’s three-tier distribution system (importer > state wholesaler > retailer) which will see price increases of at least 25% overall, Australia has still not been hit as hard as other countries.
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