PELHAM - U.S. tariffs would have a devastating economic effect on Niagara-on-the-Lake’s wineries, says Pillitteri Estate Winery’s export manager, Jared Goerz, and at his winery, they’re trying to figure out how to brace for impact.
After U.S. President Donald Trump’s inauguration, assuming his second term at the White House, the new leader of America held off on issuing an executive order to levy tariffs on Canada — only to later say he wants to place the 25 per cent tariffs by Feb. 1.
In response, Ontario Premier Doug Ford said all U.S. alcoholic beverages will be pulled from LCBO shelves if the tariffs are placed.
The United States is the largest consuming market of wine globally, making for an extremely competitive market for Canadian wineries like Pillitteri, Goerz said in an interview.
In Canada, its competitive edge is icewine, he said.
“That being said, without having that aggressive price point and sharp margins, we really just die on the shelf down there,” Goerz said.
Because the process of actually shipping wine has multiple steps, the price to do so becomes quite expensive. With a 25 per cent tariff, sales to the United States would become untenable, Goerz said.
In preparation for the worst, Pillitteri has started planning what to do when the tariffs hit.
“I would say anything is possible at this point, we’re certainly planning around it because we have to take things at face value,” Goerz said.
One possible way to mitigate large losses is to prepare holiday sales early. Because the U.S. purchases Canadian wine mostly around Christmas time, wineries have until around July 1 to get things shipped, Goerz said.
“So even if the tariffs were coming into play let’s say on Feb. 1, we would still have a little bit of time to race against the clock to either get wine there before the tariffs come into play or hold on tight until it gets dealt with,” he said.
In response to Ford’s promise to stop the sale of American alcohol, Goerz pointed out the trade imbalance between our two countries.
Canada brought in around $600 million-worth of American wine in 2023, compared to roughly $12 million-worth of Canadian wine going to the U.S., Goerz said.
“In the wine world, it really is an imbalance in favour of the Americans,” he said.
In terms of what action governments on this side of the border should take, Goerz hopes there will be programs put in place to balance the losses.
“It would just be to negate the tariff hit, to cancel out the tariffs,” he said.
“In addition to that, they would discuss and announce things in advance so the businesses could plan around it. It would be nice to know with a little bit of confidence that there is a plan in place,” Goerz said.
If anything, he said he hopes the potential tariffs inspire Canadians to buy more VQA wines.
“That’s really the biggest help that anybody can provide us.”
Julia Sacco is a Local Journalism Initiative Reporter based at The Lake Report.
