A new 20% U.S. tariff on European wine imports announced by US President Donald Trump has left Bourgogne wine producers bracing for significant losses — while expressing cautious relief that it narrowly avoided the worst.
The Bourgogne Wine Board (BIVB) warned the new tariff could cost the region’s producers up to €100 million (about US$108 million) in lost export revenue, dealing a serious setback in what has long been their largest overseas market.
The move, announced after weeks of combative rhetoric and threats of extreme measures, follows Trump’s earlier suggestion on March 13 of imposing a much steeper 200% tariff on European wines. News that the final rate would be 20% sparked a mixture of astonishment and measured relief in Bourgogne.
A Familiar Setback
The tariff echoes a 25% import duty implemented during Trump’s first term in 2019 as part of the Boeing-Airbus trade dispute.
“We’ve been through this before,” recalls Laurent Delaunay, President of the Bourgogne Wine Board (BIVB). “During his first term, Donald Trump imposed a 25% tariff in 2019 on still wines in bottles, as part of the Boeing-Airbus trade dispute. The effect was immediate: our exports to the U.S. plummeted by 15% in volume in 2020, leading to a 22% drop in revenue!”
Delaunay emphasised that American importers are often more than just clients: “They are long-standing partners, even friends, with relationships built over generations — sometimes going back over a century.”
Trimming Margins to Stay Competitive
The BIVB is urging collaboration across the supply chain to absorb the cost without pricing consumers out. “The U.S. wine import system is fairly complex, with a mandatory three-tier distribution model: importer, wholesaler, and then retailer,” explains Delaunay. “This already drives up the price for the end consumer. The risk with these additional tariffs is that they could push our wines past a psychological price threshold. I believe many producers will make an effort to lower their ex-cellar prices slightly. But we’ll also need our American partners to do their part by trimming their margins so the final price remains within a range acceptable to consumers.
He also warned of the broader risks ahead: “We’re concerned about the combined impact of tariffs and a potential economic downturn in the U.S. This may just be the beginning of a turbulent period that could hit all our markets.”
Industry Urges De-escalation
While businesses prepare to adapt, the BIVB is calling on French and European authorities to avoid a spiral of retaliatory tariffs.
“We urge them to continue a firm and constructive dialogue with U.S. authorities, so that reason prevails and we avoid a cycle of retaliation where everyone loses,” says Delaunay. “Instead of entering a tit-for-tat tariff race, let’s work toward a positive agenda for wines and spirits: a zero-for-zero agreement is within reach.”
Though Bourgogne producers export to over 170 countries, redirecting unsold U.S.-bound wines to other markets will take both time and investment, the BIVB said.
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