(Reuters) -Canadian provinces’ boycott of U.S. spirits amid a trade dispute with the United States has caused a sharp drop in sales of American imports, as well as other imported and domestic spirits across the nation, a Canadian liquor trade group said on Tuesday.
Sales of U.S. spirits in Canada dropped 66.3% between March 5, when provinces announced they would stop carrying the products in retail stores, and the end of April, according to an analysis by Spirits Canada.
The group, which represents Canadian manufacturers and marketers of distilled spirits, said total spirits sales in Canada fell 12.8% during the same period.
“The North American spirits sector is highly interconnected, and the immediate and continued removal of all U.S. spirits products from Canadian shelves is deeply problematic for spirits producers on both sides of the border,” said Cal Bricker, president and CEO of Spirits Canada.
Several Canadian provinces pulled U.S. spirits from liquor stores in response to U.S. President Donald Trump’s imposition of a 25% tariff on certain imports.
Most recently, Trump’s threat to impose a 35% tariff on Canadian goods starting August 1 has raised concerns about an escalating trade war and spurred a “Buy Canadian” movement among consumers and businesses.
In early March, Jack Daniel’s maker Brown-Forman Corp called the removal of American bourbon and whiskey from Canadian liquor stores worse than Canada’s retaliatory tariffs and described it as a disproportionate response to Trump’s levies.
According to Spirits Canada, sales of U.S. spirits in Ontario, Canada’s largest market for spirits, plunged 80% after the products were removed from shelves. Two provinces, Alberta and Saskatchewan, have since resumed selling U.S. spirits, the group said.
The decision to pull U.S. spirits has hurt American distillers, as well as Canadian revenues, consumers and hospitality businesses, Spirits Canada added.
Currently, U.S. tariffs are suspended on imports from Canada that comply with the U.S.-Mexico-Canada Agreement (USMCA). Spirits produced in Canada fall under this trade pact.
(Reporting by Savyata Mishra in Bengaluru; Editing by Mohammed Safi Shamsi)
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