A general view of Jack Daniel's is seen in a supermarket in Shanghai, China, on April 11, 2025. (Photo by Ying Tang/NurPhoto via AP).
U.S. spirits exports reached a record $2.4 billion in 2024, according to an annual report published by the Distilled Spirits Council of the United States. The remarkable figure represents an increase of nearly 10% compared to 2023, the highest ever recorded by the U.S. and quintuple that seen in 2000. However, in light of trade tensions, these gains may be lost within a matter of months.
Growth was reportedly driven by a nearly 39% increase in exports to the European Union. It was long believed that a 50% tariff on American whiskey exports would snap back into effect in March, leading many companies to proactively increase their inventory across the pond. This practice, known within the industry as frontloading, may be one of the main reasons why exports skyrocketed despite gloomy tariff news.
DISCUS believes that the September dockworker strike and the premiumization of American spirits may have also had a role to play.
"Other factors that have driven long-term growth in exports include the shift by consumers in key markets towards premium American spirits, the continued reopening of the hospitality sector following the pandemic, and the rise in U.S. distillers, from less than 100 in 2005 to nearly 3,100 today, many of which now export," DISCUS President Chris Swonger said.
American whiskey accounted for 54% of international shipments, amounting to $1.3 billion in value. Cordials and vodka had a particularly good run, reaching never-before-seen highs of $367 million and $292 million, respectively. Brandy, gin and rum weren't quite as lucky, each reporting modest declines year over year.
Where those numbers will go in 2025 and beyond remains uncertain.
For the time being, exports to the European Union appear safe. Following pushback from French and Irish authorities, European officials recently agreed to drop a retaliatory tariff that would have targeted American whiskey. The move was made in response to a Truth Social post in which President Donald Trump threatened a 200% tariff on European alcohol. Interestingly, the E.U. has moved forward with its plan to target recognizably American goods like motorcycles, blue jeans and beef in its 21 billion euro tariff response. American whiskey and wine were among the few products omitted.
Canada, the second largest market for U.S. spirits exports, isn't looking quite as hopeful. In addition to imposing a 25% tariff on U.S. spirits, several Canadian provinces have gone so far as to remove all American alcohol from liquor store shelves. If the trend continues, $221 million worth of spirits exports to the country will be put at critical risk. In all likelihood, they already have.
The United Kingdom and Australia are the third- and fourth-largest export markets, collectively valued at around $270 million. Both countries are subject to the Trump administration's across-the-board 10% tariff, though neither has responded with reciprocal rates.
If the E.U., Australia or the U.K. do eventually impose reciprocal tariffs, it could tip the scales drastically out of favor for American distillers.
That's more or less what happened in 2018. Following a back-and-forth over steel and aluminum duties, European and British officials agreed to slap American whiskey with a 25% tariff. Exports plummeted by hundreds of millions of dollars over the next few years, finally rebounding in 2022 after the tariffs were suspended under the Biden administration.
As the 90-day deadline on Trump's so-called "Liberation Day" creeps closer and closer, how countries choose to respond could reshape America's position within the spirits market.
"Continued long-term growth for the industry will be dependent on ensuring a permanent return to zero for-zero spirits tariffs with the 51 countries and securing new market opening agreements with countries where high spirits tariffs are still applied, such as India, Vietnam, South Africa and others," Swonger added.
