Canadian wineries see surge in demand as trade dispute limits American alcohol imports

Trevor Miller, owner of Mountain Soul Vineyard and Winery, was busy planting riesling vines under the April sun just north of the U.S. border in British Columbia. The vines, imported from Washington state, arrived without tariffs, a relief for Miller who had been concerned about possible extra costs due to ongoing trade tensions between the United States and Canada. Since the imposition of U.S. tariffs on Canadian goods and the subsequent response by Canadian provinces to halt imports of American alcohol, Miller has seen a significant increase in demand for his wines at local restaurants and liquor stores.

Miller noted that orders have not only increased in volume but also in speed, with some distributors doubling their usual requests as consumers shift their preferences toward Canadian products. He mentioned that even some Americans are crossing the border to purchase Canadian wine, showing support for local producers. For now, Miller is focused on meeting the needs of his current customers rather than expanding into new markets. Mountain Soul Vineyard, which covers 25 acres and was established over a decade ago, is still building its reputation since Miller acquired it in 2020. He sees the current situation as an opportunity to grow his customer base as wine drinkers look for alternatives to American brands.

Despite the boost in business, Miller remains cautious about the future. He does not export his wine and is not directly affected by U.S. tariffs on Canadian products, but he faces challenges if he needs to buy supplies from American sources. For example, there is a shortage of bottles from Canadian suppliers, which could force him to pay higher prices for imports. Rising costs due to inflation or a potential recession would also be difficult for his small operation to absorb.

The impact of the trade dispute is visible at government-owned BC Liquor stores in towns like Salmo, where American alcohol has disappeared from shelves. Instead, customers find labels promoting “100% British Columbia Wine” and exclusive provincial selections. Signs encourage shoppers to “Buy Canadian Instead.” Private liquor stores and bars are allowed to sell remaining stocks of American products until they run out. At Silver Dollar Liquor Store nearby, manager Chalise Bonderoff said sales of American whiskeys like Jack Daniels and Jim Beam continue at regular prices, though more customers are asking for Canadian options.

Luis Perez, a customer at BC Liquor store, observed that prices have risen and said he is following government encouragement to buy Canadian products. However, not all wines labeled as Canadian are made entirely from domestic grapes. After a severe freeze last year damaged much of British Columbia’s grape crop, many wineries sourced grapes from Washington state.

Chris Stone of the Washington State Wine Commission reported that while grape exports to Canada are usually modest—about 5,000 tons out of 150,000 last year—they became crucial after the freeze. Canada is also Washington’s largest export market for finished wine, worth about $12 million annually. Since the trade conflict began, those exports have stopped completely.

Stone explained that only about 5% of Washington wine is exported internationally, but Canada had been a growing market before tariffs halted shipments. Efforts to expand into Asia and Europe are now on hold until there is more clarity about future tariff rates.

Other Washington producers have also felt the effects. Dry Fly Distilling in Spokane paused plans to export spirits to Canada when the market closed. Hops grown in Yakima Valley remain unaffected by countertariffs so far but represent another area of concern; Washington exported $36 million worth of hops to Canada last year.

Marty Clubb, owner and winemaker at L’Ecole No 41 in Walla Walla Valley, said his winery has exported about 1,000 cases annually to Canada for 25 years—about 3-4% of his business. While not a large share overall, every sale counts during a downturn in the wine market. L’Ecole has stronger ties with Québec due to historical connections with French Canadian fur traders who settled near Walla Walla in the early 1800s.

Clubb noted that besides losing access to Canada’s market because of tariffs, he also lost business in Denmark after political tensions rose over U.S. foreign policy statements regarding Greenland. He believes that even if trade relations improve soon, negative feelings toward U.S. products may persist among international buyers.

As producers on both sides of the border wait for resolution or changes in policy, many are left uncertain about how long these disruptions will last or what long-term effects they may have on their businesses and customer relationships.