Beware: Tariffs on Holiday Wine are Coming Your Way!

Bottled wine prices have seen a significant increase, with a nearly 20% rise over the past 25 years and an 8% jump in the last decade, according to recent government data. As the holiday season approaches, consumers face higher prices and potentially limited selections at wine shops due to steep tariffs and a decline in demand.

In Manhattan’s McCabes Wine & Spirits, prices have climbed between 5% to 12% this year, attributed to tariffs on imports, shipping costs, and labor challenges. Owner Daniel Mesznik noted, "It’s the reality of the tariffs, shipping, manufacturing and labor," emphasizing the need to keep price increases to a minimum for customers.

Importers are heavily impacted as well. Elenteny Imports reported a 13% drop in wine sales compared to the previous year. Overall wine consumption has declined in the U.S., with a 3% decrease from 2019 to 2024, and a projected 4% drop from 2024 to 2029. Marten Lodewijks, president of IWSR, pointed out that many consumers are shifting towards spirits and ready-to-drink cocktails, which are perceived as more affordable.

Data from Elenteny indicates that order volumes for imported wines are down nearly 30% year-to-date. The decline comes after a period of heightened demand post-pandemic, with current tariffs complicating the situation. Domestic wines, which were expected to benefit from these tariffs, are also experiencing sluggish sales.

In response to the changing market, Mesznik’s shop has adjusted its strategy, now focusing more on tequila and mezcal, which are exempt from tariffs. This shift has led to tequila representing a growing share of sales, while traditional wine categories diminish.

As the supply from major wine-producing regions declines—reported at 50% from France and 66% from Italy—consumers may encounter fewer options at retail locations. Mike Veseth, known as the Wine Economist, warned of streamlined offerings in many stores due to falling demand across the alcohol sector, potentially leading to challenges in finding specific brands.

The upcoming Supreme Court review on tariff legality adds further uncertainty, affecting retailer decisions regarding pricing and inventory. Currently, lower-end and premium wines are showing more robust sales, while mid-priced offerings struggle. Retailers are adapting by smartly sourcing from wholesalers to manage costs more effectively.

For more details on wine tariffs and their impact, visit: CNN.

About the Author: Chris Lehoux

Meet Chris Lehoux, an experienced wine connoisseur and dedicated blogger with a deep passion for all things wine-related. With years of expertise in the industry, Chris shares insightful wine reviews, valuable wine tasting tips, expert pairing advice, and captivating tales of vineyard visits. Join Chris on a journey through the world of wine, where every sip is an adventure waiting to be savored!