Trump's fighting words to France: Open your wine market
President Donald Trump's Twitter tirade against French President Emmanuel Macron on Tuesday also took aim at a sensitive subject for oenophiles on both sides of the Atlantic: wine.
"On Trade, France makes excellent wine, but so does the U.S. The problem is that France makes it very hard for the U.S. to sell its wines into France, and charges big Tariffs, whereas the U.S. makes it easy for French wines, and charges very small Tariffs. Not fair, must change!" Mr. Trump tweeted.
The Wine Institute, an industry trade group based in California, notes that European Union tariffs on American wine exports are in some cases nearly double those of U.S. tariffs. The EU's import tariff on U.S. wine ranges from 11 cents to 29 cents per 750 ml bottle; the U.S. puts a 5 cent to 14 cent tariff on wine imports, according to trade data. The tariff range depends on the percentage of alcohol in a given bottle of wine.
The U.S. and European Union are each other's largest wine export markets, according to the Wine Institute. Some other countries apply much stiffer tariffs on American-made wine. U.S. exports to India face a whopping 150 percent tariff, for instance.
On Trade, France makes excellent wine, but so does the U.S. The problem is that France makes it very hard for the U.S. to sell its wines into France, and charges big Tariffs, whereas the U.S. makes it easy for French wines, and charges very small Tariffs. Not fair, must change!
— Donald J. Trump (@realDonaldTrump) November 13, 2018
The EU, including France, last year exported wine valued at $12.7 billion (11.3 billion euros), with more than $4 billion of those shipments going to the U.S., according to Eurostat. American wine exports, 97 percent of which are from California, reached $1.5 billion last year, according to the Wine Institute. About $553 million of that went to the EU.
Mr. Trump and European Commission President Jean-Claude Juncker in July announced an agreement to work toward resolving trade issues. The EU is also concerned about potential tariffs on autos, something Mr. Trump is considering anew, according to a report Axios.
Unlike the auto industry, U.S. winemakers are more optimistic a trade war can be avoided.
"Wine Institute believes the upcoming trade negotiations between the U.S. and EU will create market opportunities by reducing tariffs and addressing other market access issues," said Robert Koch, CEO of the Wine Institute, in a statement emailed to CBS MoneyWatch.
Tuesday's tweets come after Mr. Trump's visit to France on the 100th anniversary of the end of World War I this past week, where Mr. Macron indirectly took aim at Mr. Trump, who missed a ceremony due to rain.
Trump wine
The Trump family is no stranger to the wine business. Trump Winery in Charlottesville, Virginia, is run by Eric Trump, listed as president on the winery's website. The business began planting grapes in 1999, according to the website.
A listing for Trump Winery is registered in 2011, with ownership listed by Eric Trump Wine Manufacturing, according to filings with the Virginia Secretary of State's office. There are several other wine-related entities listed with Virginia under the Trump name.
California exporters are already dealing with retaliatory tariffs from one of its fastest-growing markets: China. Even with the threat of those tariffs, U.S. exports were up 14 percent through June, according to a September release from the Wine Institute.
China imposed the tariffs in response to some $250 billion in tariffs on exports to the U.S. imposed by the White House. One area where U.S. winemakers are happy with Trump trade policies? North America.
The Wine Institute approved of at least some parts of the White House's renegotiation of the North American Free Trade Agreement, or NAFTA, saying in an October release the new agreement would help open Canadian markets for U.S. producers,