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American whiskey makers face ‘more harm’ if tariff issue not resolved

Lawson Whiting, president and chief executive of Brown-Forman, has warned President Biden that US whiskey producers face “more harm” if the US fails to resolve a tariff dispute with the European Union.

Back in 2018, Donald Trump slapped 25% penalties on imports of steel and aluminum, citing “national security” as his grounds for doing so. In retaliation the EU (of which Britain was then a member) imposed mirror duties on imports of iconic American goods including Bourbon and other American whiskey as well as jeans, orange juice, tobacco, peanut butter, yachts and Harley-Davidson motorbikes.

Those tariffs are due to double on June 1, prompting Whiting to say: “The steel and aluminum dispute is still hurting American whiskey consumers, workers and companies on both sides of the Atlantic,” and that unless they are removed US distillers face “more harm”.

US whiskey exports to the EU slumped by 29% in 2019, the latest figures available.

The tariffs on American whiskey are separate from those imposed by Brussels on other American drinks as part of the long running tit-for-tat spat over subsidies to Boeing and Airbus.

The EU and the Biden Administration agreed earlier this month to set those aside for four months while they seek a permanent agreement but the steel and aluminium imposts remain and so Brussels and the UK have retained those on US whiskey, including Brown-Forman’s iconic Jack Daniel’s.

Spirits producers on both sides of the Atlantic are pressing hard for the dispute to be resolved but Biden’s team face the harsh political reality that Trump’s tariffs on steel and aluminium are propping up jobs in many industrial “Rust Belt” states, where he is under pressure from voters and the unions to retain them.

Sources in Brussels and London suggest that they want to end the dispute but so far no significant progress has been made. Conversely, there is some confidence on both sides that the Boeing v Airbus spat can be resolved by June 1 and that the duties imposed by the US on Scotch, Cognac and European wines will be lifted permanently.

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