NC wines not exempt from tariffs' impacts
Burke County wine expert John Zimmerman said tariffs on foreign goods could cause the cost of U.S. wines to increase. Pictured here are red wines awaiting judging at the recent N.C. Fine Wines competition.
Talk of potential tariffs seems to be on everyone’s minds these days, and while buyers of imported beer and liquor will almost certainly see an increase in prices, wine drinkers, especially those who favor domestic bottles, may believe they will escape the pain of tariffs.
But according to Burke County wine expert John Zimmerman, even wines made in the state will feel pain. Part of the issue lies in the quality, or lack thereof, of grapes grown in North Carolina soil.
“A problem with N.C. wines generally is lack of ripeness,” Zimmerman said. “Our weather is just not warm enough to ripen the grapes that make the most money, like Cabernet Sauvignon, for example. So, producers will grow the grape knowing buyers will purchase that wine because it’s familiar.”
The problem, according to Zimmerman, becomes what to do when the juice doesn’t get ripe and is flavorless. It needs to be aged over oak, so it tastes like something.
“Most of the oak barrels we use in this country come from France, and other than the grapes, contribute the most cost to the wine,” Zimmerman explained. “French oak barrels can cost $1,500 to $2,000 and more, and you get about 250 bottles from a barrel. Those barrels will be hit with the tariffs.”
Zimmerman said the dilemma facing winemakers will be similar to the tariff issues facing those in the automobile industry. Even if your car is made in the United States, the parts (in the case of wine, the barrels) might not be.
Those who have a taste for imported wines should brace for price hikes, according to Zimmerman.
“Certainly, these tariffs are going to drastically affect the international wine market in multiple ways,” he said. Here are some effects he sees right out of the gates:
- Increased cost. “Obviously, no, the producers are not going to carry the burden of the tariff. They will pass it on to their exporter, who will pass it to the importer, who will pass it to the distributor, who will pass it to the retailer, who will pass it to you.”
- Many fewer options. “This will especially affect the availability of small producers’ wine, the very kind of people we should be supporting because 1) they’re doing cool stuff, 2) supporting small, family businesses over corporate wineries feels better, and 3) those wines by their nature are already a bit more expensive so the tariffs will likely price them out of the US consumer markets. If I’m an average consumer who is already waffling over spending $10 more on the small producer’s version of Chianti Classico vs. Banfi, I’m definitely going to waffle now that both are going up even more.”
- Whole regions are likely to evaporate from the U.S. market; “Up-and-coming regions that are clamoring for shelf space will simply not make it. They are likely already losing money in their efforts to ‘get on the board.’ They will not be able to afford to lose more, as these are often niche products a decade or so before they enter mainstream.”
Zimmerman says here at home, all wines are going to go up, by several dollars actually.
“Just like cars, there are almost no wines that are entirely U.S. products. In fact, I cannot think of one. I’m sure there are some out there, but I can’t think of any,” he explained.
Producers in the United States might grow the grapes, but we are not producing:
- French oak barrels (25% tariffs on $1500-$2500 spread over 250 bottles of wine is definitely going to hike costs on every bottle of wine that is aged or fermented or both in French oak barrels). No, you can’t just swap out American oak. It tastes completely different — more vanilla, coconut, and dill flavors.
- Corks
- Glass
- Stelvin closures (screw caps specifically for wine)
- Ink for printing labels
All of this information means wine drinkers should prepare to open their wallets a little wider if tariffs go into effect.
“The grapes might be grown in America, and the labor might come from America, but just about everything else, American winemakers are buying from afield, and we do not have American equivalents,” Zimmerman said. “So certainly, wines grown and produced in America are going to see substantial price increases as well.”
Sandra Wilkerson Queen is the arts & entertainment editor. She may be reached at 828-445-8595, ext. 2002, or sandra@thepaper.media.
