US Spirits Exports Drop Sharply as Canada Sales Collapse by 85%

The latest American Distilled Spirits Exports 2025 Mid-Year Report by the Distilled Spirits Council of the United States (Discus) paints a grim picture for the industry. US spirits exports fell by 9% to US$593.6 million in the second quarter of 2025, signaling a major setback after a record-breaking year in 2024.
(Source: The Spirits Business)

Canada’s Market Sees a Historic 85% Decline

Exports of US spirits to Canada plummeted by 85%, totaling just US$9.6 million—marking the first time the figure dipped below the US$10 million threshold. Discus revealed that April 2025 alone saw a 68% drop in American spirits sales in Canada, while Canadian and other imported spirits each grew by roughly 3.6%.

Canada has long been a vital market for American producers. In 2024, it imported US$221 million worth of US spirits, ranking as the second-largest export destination after the European Union.

However, provincial bans on American spirits remain in place across much of Canada, despite the removal of retaliatory tariffs on September 1. The ongoing trade tensions have strengthened demand for Canadian-made alternatives, especially local whisky brands.

Declines Continue Across Key Global Markets

The downturn isn’t limited to Canada. Exports to the European Union—which accounted for half of US spirits exports in 2024—fell 12% to US$290.3 million in Q2 2025. The United Kingdom and Japan also saw major drops of 25% and 23%, respectively.

Combined, these four regions (EU, UK, Japan, and Canada) represent 70% of total US spirits exports by value, highlighting how trade disruptions in a few key markets can ripple across the entire industry.

American Whiskey and Other Categories Also Suffer

Discus reported double-digit declines across most US spirits categories during Q2:

• American whiskey: down 13%
• Vodka: down 14%
• Brandy: down 12%
• Rum: down 6%
• Cordials: down 15%

These numbers mark a steep contrast to 2024, when total US spirits exports climbed nearly 10% to a record US$2.4 billion.

Industry Leaders Raise the Alarm

“This new data is very troubling for US distillers,” said Chris Swonger, President and CEO of Discus, in a statement cited by The Spirits Business. “Persistent trade tensions are having an immediate and adverse effect on US spirits exports. Our international consumers are increasingly opting for domestically produced spirits or imports from other countries, signaling a shift away from our great American brands.”

Over the last two decades, global markets have fueled remarkable growth—US spirits exports have increased more than fivefold since 2000. Yet, the latest data suggests that momentum is faltering.

Calls for Fair Trade and Tariff-Free Access

Earlier this year, the US and UK agreed on a free trade agreement capping tariffs on imports at 10%, while the US and EU established a 15% tariff deal. Still, industry voices argue that uncertainty continues to stifle exports.

“With domestic demand slowing, US distillers need the certainty of zero-for-zero tariffs with our key markets,” Swonger added. “The spirits sector has long been a model for fair and reciprocal trade, and tariffs on imported spirits create consequences across the entire industry.”

He urged the US administration to work toward a lasting, tariff-free environment to secure long-term growth.

New Trade Coalition Joins the Effort

The American Whiskey Association (AWA) echoed these concerns. CEO Michael Bilello emphasized the need for “fair competition and market access abroad” to safeguard the category’s future. The AWA pledged to continue collaborating with Discus and policymakers to remove trade barriers and expand access for American whiskey globally.

Meanwhile, ongoing tariffs continue to hurt other producers as well. The Scotch Whisky Association estimates that the US’s 10% tariff on UK goods is costing the Scotch whisky industry around £20 million (US$27 million) each month in lost exports.

The Global Balance Shifts

The steep decline in US spirits exports highlights how fragile global trade dynamics remain for American distillers. As Canada, the EU, and other markets tighten their restrictions, domestic producers face mounting pressure to adapt, innovate, and push for more equitable trade agreements.

Without urgent policy action, what was once a booming export category could face prolonged stagnation—leaving room for competitors to capture once-loyal markets.

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Source of information

The Spirits Business Article — US spirits exports to Canada plummet 85% in Q2, written by Nicola Carruthers

The image of the article is courtesy of ©shaunl via Canva.com