The outlook for Prosecco, Brunello di Montalcino and other Italian wines in the United States is increasingly gloomy, producers and importers said, following President Donald Trump’s imposition of a 20% tariff on European imports.
Italy exports more wine to the U.S. than any other country. Last year, it sold 2 billion euros ($2.2 billion) worth of wines, spirits and vinegars in the U.S. market, a quarter of its total worldwide exports, according to trade group Federvini.
Italian producers and U.S. importers gathered at a wine fair in Verona, in the north-eastern Veneto region this weekend, said business had already been hit by the fear of U.S. tariffs and things could only get worse as they come fully into effect.
Under the announced levies, Italian wine revenues would fall by some 323 million euros per year, said Lamberto Frescobaldi, chairman of the Italian Wine Union lobby.
Wine traders and producers are pinning their hopes on a deal between Europe and the U.S. to scrap or reduce the tariffs.
“Hopefully, the EU will not retaliate – a trade war would be difficult to navigate,” Simone Luchetti, president of U.S. importer Banville, told Reuters at the Vinitaly fair in Verona.
While the sector was spared the 200% tariff Trump had threatened to impose, it remains a threat if European counter-measures target U.S. spirits, such as bourbon whiskey.
CONSUMPTION TO PLUNGE
Luchetti – who imports Brunello, Amarone, Prosecco and Barolo among others – estimated a 25-35% drop in U.S. consumption and in Banville’s revenues under current tariffs.
Other importers warned that some wine brands would disappear from the U.S. market as consumers looked for cheaper bottles.
“If the price of a wine increases, consumers will probably leave that brand. They will rather stay within their preferred price range,” said Charles Lazzara, founder of U.S. buyer Volio Imports.
Under the announced levies the cost of a bottle of mid-range Prosecco, Lazzara said, would rise from $10.99 to $12.99 in U.S. shops.
Luchetti echoed those concerns.
“It will probably become difficult to sell Prosecco bottles which today cost $14-18 because their price will rise to $20,” Luchetti said.
The U.S. tariffs also worried Italian producer Marilisa Allegrini, founder of the Marilisa Allegrini Group, which produces 840,000 bottles per year, including Brunello di Montalcino, Bolgheri, Valpolicella and Amarone.
“Wine consumption in the U.S. was already in crisis, and tariffs have hit it further,” she said.
Some Italian producers, however, were more upbeat, saying U.S. drinkers love Italian wines and are unlikely to replace them with cheaper alternatives, despite the tariffs.
“Prosecco can only be produced in Italy, especially in Veneto – it can’t be replaced!” said Giancarlo Moretti-Polegato, owner of Villa Sandi, a prosecco producer based in the hills of Montebelluna, in the Veneto region.