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How Trump’s Steel Tariffs Could Wound the American Whiskey Industry

President Trump officially imposed tariffs on imported steel and aluminum products last week, a move that’s going to have an unexpected casualty: the American bourbon and whiskey industry.

In response to the tariffs, the EU and Canada have imposed similar tariffs on imports from the United States including whiskey and bourbon. Both have included whiskey on their list of retaliatory surtaxes, a move that will likely decrease sales of the spirit abroad, VinePair reports.

For some perspective, bourbon sales totaled $154 million in the European Union last year, a growth of $26 million from sales in 2016. Sales are on the rise, but a huge additional tax could cause them to instead be on the decline.

“Bourbon is a thriving $8.5 billion industry in Kentucky, generating 17,500 jobs with an annual payroll of $800 million. Spirits production and consumption pours more than $825 million into federal, state, and local tax coffers every year,” Eric Gregory, President of the Kentucky Distillers’ Association said in a statement regarding the tariffs. “We remain hopeful that continued negotiations will avoid a costly trade war and protect our allies and partnerships around the world, which will continue to benefit spirits producers and consumers for years to come.”