Donald Trump, President of the United States: this perspective plunges the French wine industry back into the throes of the eponymous tax, the increase in customs duties imposed by the Republican during his first term between 2019 and 2021.
In the aftermath of the American elections, which winemaker has not thought of the famous Trump tax, the 25% tax on French still wines established by the United States in October 2019? Suspended by Joe Biden, but not lifted, this tax remains, like the sword of Damocles, above the heads of French winegrowers.
It was following the conflict between Boeing and Airbus that the tax was put in place. We all remember Donald Trump's leitmotif, “America First”. For the wine industry, cruelly affected by a structural crisis, this tax is not insignificant. At the time, the French wine industry had suffered a shortfall of 600 million euros in one year on the American market.
The specter of American protectionist policy makes one shudder and the federation of French wine and spirits exporters had, as soon as the election of Donald Trump, reacted, encouraging the future administration “to quickly initiate a constructive and fruitful transatlantic dialogue”.
For Occitanie, the USA represents 15% of exports
“In the USA, France achieves 4 billion euros in turnover, it is the most strategic destination for us, the one where we create the most added value, the one where the margin is the highest. It is the leading consumer country in the world and for us this is important because France is the leading supplier of wine in value to the United States, explains Jean-Marie Fabre, national president of Independent Winegrowers. For Occitania, the USA represents 15% of exports in value.
For the union leader, himself a winegrower in Fitou, no one knows who Donald Trump is, nor his values: protectionism and patriotism. “I regret that France did not take advantage of the four Biden years to put all its weight behind the European Union and definitively resolve the Boeing-Airbus economic dispute. 600 million euros were lost in one year, and the Trump tax that was suspended can be reinstated very easily by the new administration.”
For Coop de France vin, the regional president, Ludovic Roux, has no illusions: “The USA has only placed a moratorium on this famous tax, so they can very easily reinstate it. And of course, if this is the case, it will add to the difficulties currently encountered by wine growers. The European Union must absolutely defend or compensate us.”
Will European countries be placed under the same umbrella?
But at the Interprofessional Languedoc Wine Committee (CIVL), the trend is more combative than pessimistic: “This tax can be an opportunity for Languedoc wines because they are less expensive than those from other regions and very high quality, explains Pierre Bories. What had been done and which had disrupted market shares was a nine-month lag with Italy. We had been unable to do anything and, during this time, Italy had taken shares that we were unable to recover. Georgia Méloni and Elon Musk are close and faced with Trump's strategy of dividing, we must be vigilant about the positioning of all European countries. The president adds another important fact: “Everything also depends on the agreements made between the United States and the countries of South America, and also Australia. Because during the first Trump mandate, we lost market share. The answer is very complex: what will he take regarding Australian wines? If he puts taxes on everyone, we are on the same starting line and, there, may the best win!
The editorial staff – Claude Delbourg
Numbered benchmarks
In the United States, 33,314 million hectoliters of wine are consumed per year: 24.3 million hectoliters are produced locally, a large part of which is consumed in the country. Americans import 12,265 million hectoliters: mainly Italian and French wines.
The United States represents France's second largest export country after Germany.
France exports 12.7 million hectoliters of wine in all categories worldwide, including 1.6 million to the United States and 1.2 million still wines, 194,000 hl for the region including 71,000 hl of AOP Languedoc-Roussillon
Remember that if Languedoc Roussillon were a country, it would be, with 8.9 million hectoliters, the 8th largest producer of wine in the world, because it represents 4% of world production. The production of its vineyard is equivalent to Australia, South Africa, Argentina and Germany and is greater than that of Portugal.
They export to the United States
At Celliers des Demoiselles, in Saint-Laurent de la Cabrerisse, we want to send a positive message in the current gloomy context: “We are still fighting on exports, the USA accounts for 10% of our export sales, underlines the director, Anaël Payrou. Our American agent told us his position: he is waiting, because he does not know whether the tax will be applied or not. In the meantime, we refuse to think negatively. The United States and China are dynamic markets. Wine is the fuse of international trade.”
At Château Lastours, in Corbières, the United States, with 20%, represents one of the best export markets. “The reinstatement of the Trump tax would be bad news, it’s still us who will have to bow down, reacts spontaneously Thibaut de Braquilanges, the director. Last time, the Americans had us cornered and we had to lower our prices to be able to sell. The distributors flatly told us that they could not assume this 25% extra, that it was up to us to do it! We will have to go even further into the field to show that the quality justifies the price positioning! Either we maintain, with an effort on our side, or we lower our range to sell, because in four years we have been able to establish our presence and our references, it would be a shame to go backwards.”
Americans love bubbles, and, noted with humor Françoise Antech, from the famous Limoux house Maison Antech, “They are less snobbish than the French! The name crémant has a very beautiful image. They taste it and then they ask: how much? When we tell the Americans that blanquette was made at the abbey of Saint-Hilaire in 1544 , they are interested because they are very fond of History!”
The Antech house, which produces 98% Crémant and Blanquette, exports 85% of its wines, including 15% to the States. But the Trump tax spared them last time. This time… mystery! Françoise Antech is optimistic: “The United States produces few sparkling wines and we are very well positioned compared to the competition. And by selling on the wine merchant and restaurant circuit, we are not in the mass distribution niche. So, even if we don't know what's really going to happen, we're going to stay offensive, and prepare to build muscle as we've been able to do in the past!”
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