"Liberation Day," the day President Trump began imposing tariffs of various sizes on our best trading partners and allies, was April 1, 2025. But lest you forget, he was stirring the pot, imposing a 25% tariff on Canadian exports.

Canada responded. Canadian provinces began removing U.S. wines from store shelves in retaliation for U.S. tariffs, new full-year data shows the bans triggered a massive collapse in U.S. wine exports to Canada and left American wineries, growers and workers paying the price.

A new Wine Institute fact sheet detailing full-year 2025 trade data shows U.S. wine exports to Canada fell 78% year over year, driving a $357 million loss in export value. The disruption also reversed a long-standing trade relationship — turning a $254 million U.S. wine trade surplus in 2024 into a $90 million trade deficit in a single year.

“Behind these numbers are family businesses, growers, distributors, hospitality workers and entire communities who have no connection to this dispute — and yet are paying the price every day,” said Steve Gross, interim president/CEO of Wine Institute. “For many wineries, Canada wasn’t just another export destination. It was the market that made international growth possible.”

Canada was the top U.S. wine export market in 2024, representing 36% of all U.S. wine exports worldwide and $460 million in shipments. In 2025, Canada’s share fell to 12%, destabilizing what had long been the anchor of the U.S. wine export economy. The impact was so severe that 81% of total global U.S. wine export losses in 2025 are attributed to the Canada bans.

Canada Is Losing Too
The bans are also creating measurable economic harm in Canada. The British Columbia Liquor Distribution Branch is forecasting a CAD$77.2 million budget shortfall for fiscal year 2025-26 — a 13.2% decrease in net income compared with the prior year — citing the removal of U.S.-made alcohol products as a contributing factor.

Canadian importers, sales representatives and hospitality workers have lost jobs and income, while consumers have lost access to familiar American brands.

Wine Institute Calls for an Immediate Resolution
U.S. wine is produced in all 50 states and generates more than $323 billion in total economic activity, supporting rural communities and local economies nationwide.

With damage mounting and the bans failing to advance broader trade relations, Wine Institute is calling on leaders on both sides of the border to end this unprecedented barrier and restore normal trade.

“Our wineries urgently need a return to open trade with Canada. Their livelihoods depend on it,” Gross said. “Wineries plan and invest years ahead — you can’t replace a market like this overnight. One year is long enough.”

U.S. Alcohol Singled Out

We're reporting on the effects of Trump's tariffs almost daily. Yesterday we carried a story about a Napa Valley Vineyard facing foreclosure after its owner decided continuing to pay the mortgage would be "throwing good money after bad."

The Wine Institute notes that the Canadian bans on U.S. bev/al were because of tariffs that are totally unrelated to agriculure. The U.S. bev/al industry is the only U.S. industry that has been completely barred from every Canadian province.

In the fact sheet, Wine Institute detailed the damage done to U.S. Wine:

• $357M+ in lost export value to Canada in 2025
• ~95% of affected wineries are family-operated small and medium-sized businesses.
• U.S. wineries are sitting on 1M+ cases of Canadian-labeled wine — inventory that can’t be absorbed by the U.S. market or shifted to other export markets.
• Regulations make Canadian-labeled wine unsellable without costly relabeling. Competitors from EU, Australia and New Zealand are filling vacant shelf space.
• U.S. wine is produced in all 50 states and generates more than $323 billion in total economic activity