American liquor exports to Canada 'plummeted' 85%, says U.S. trade group

American spirit exports to Canada "plummeted" 85 per cent in the second quarter of 2025, with the Distilled Spirits Council of the United States calling the situation "very troubling" as consumers in key international markets opt for alternatives to U.S.-made products amid trade tensions.

The numbers come as American alcohol largely remains off Canadian shelves and unavailable in bars and restaurants as a response to U.S. President Donald Trump's decision to impose tariffs on Canadian goods in early March.

In a report issued earlier this week, the council said exports to the U.K. and Japan fell 29 per cent and 23 per cent, respectively, but the largest decrease was in Canada. These countries, along with the European Union, accounted for 70 per cent of U.S. spirit exports in 2024.

The council represents producers of spirits such as whisky, vodka, rum and brandy.

"This shift may reflect a broader sentiment that U.S.-imposed tariffs are unfair, prompting consumers to support their domestic industries or seek non-U.S. products in response," the council wrote in a report.

In a news release, council CEO Chris Swonger said trade tensions are having an immediate and adverse effect on the export of U.S. spirits.

"We urge the President to help facilitate a lasting return to tariff-free trade with our longstanding trading partners to ensure the continued growth and vitality of this great industry,” he said.

The council did not respond to an interview request by deadline.

On Wednesday, Prime Minister Mark Carney said Canadian and American officials are negotiating terms of a deal on tariffs.

In late August, Brown-Forman, the parent company of alcohol producers such as Jack Daniel's and Woodford Reserve, said sales to Canada dropped 62 per cent during the first fiscal quarter of 2026, which concluded on July 31.

In an August conference call with investors, Brown-Forman CEO Lawson Whiting said the trade dispute has caused "significant headwinds."

"While our non-U.S. brands such as Diplomatico and El Jimador continued to deliver growth, they were not able to offset the decline of our brands that are produced in the U.S.," he said at the time.

Robert Huish, an associate professor at Dalhousie University in Halifax with an expertise in international affairs and tariffs, isn't surprised by the drop in U.S. spirit exports to Canada.

"Some of the biggest single purchasers of spirits from the U.S. are Canadian: the LCBO in Ontario and SAQ in Quebec," he said. "They are huge purchasers of American spirits and, of course, American wine as well, so to see the shelves bare would absolutely have an impact."

The Nova Scotia Liquor Corporation, the Crown corporation that is the province's largest alcohol retailer, says the removal of American products from shelves has led to higher sales for local products.

From March 4 to Sept. 15, sales of Nova Scotia spirit products and wine increased 24.2 per cent and 15.1 per cent, respectively, compared to the same time a year ago.

Olivia Giffen, vice-president of marketing and retail at Coldstream Clear, a Nova Scotia spirits and beer producer, said its spirit sales have increased significantly.

"I do think that with everything going on, people were really looking for, 'OK, what are the products that I can now choose that are local?' and making that conscious decision to find products they still really enjoy in the taste, but a big bonus being that it is local," she told CBC's Information Morning recently.

The NSLC also said Canadian wine and whisky sales are up 8.9 per cent and 8.5 per cent, respectively, compared to a year ago.

Assuming the trade dispute gets resolved and American alcohol becomes widely available again, Huish expects some Canadian consumers will continue to buy Canadian.

"As we're hearing day after day, feelings are still hurt and many Canadians are in a position to think that that relationship with the U.S. is not going to go back," he said. "And so rather than seeking out a product for convenience, there will be a conscious choice of the national loyalty coming into the equation."

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