**Avignon**: French grapevine producers are grappling with potential US tariffs and ongoing trade tensions that threaten their livelihoods. As wineries like Château Terre Forte struggle, producers call for urgent negotiations, fearing significant impacts on exports to the critical American market and wider EU relations.
Grapevine producers in southern France are facing significant challenges as they kick off the wine season, only for it to take a grim turn, largely attributed to ongoing trade tensions and potential tariffs imposed by the United States. The picturesque vineyards surrounding Avignon are home to family-run operations like Château Terre Forte, where owners Nadine Auray and Pierre Jauffret highlight the immediate impacts on their business.
“We have one [worker] that left … because we couldn’t pay him anymore,” Auray revealed, indicating that financial strains prompted by the anticipated tariffs are damaging the workforce stability at their winery.
Jauffret expressed grave concerns about U.S. President Donald Trump’s tariff threats, stating, “I think he will kill the wine market in the U.S.A.” These sentiments reflect the broader anxiety among European wine producers, as Trump has proposed a hefty 200 per cent tariff on wines as part of a larger trade dispute that encompasses various sectors, including steel and automobiles. The situation escalated when U.S. duties were imposed on European steel and aluminium earlier this month, igniting fears of retaliatory measures that could further restrict wine exports.
Château Terre Forte produces around 15,000 bottles of wine annually on its 25 hectares of vineyards. Although the winery primarily exports to Canada, 10 per cent of its shipments are crucially directed to markets in California and New York. Auray explained that a distributor in California rescinded a recent order, citing uncertainty over potential costs arising from the tariffs. “We should have an order in April for the U.S. markets, and today they said they won’t order,” she noted.
In total, Europe exports over $14 billion worth of alcohol and wine to the U.S. each year, with French wines alone accounting for more than $2 billion. This export market has been under pressure from various global trade disputes, particularly with China, compounded with challenges like climate change and a notable decline in global alcohol consumption trends.
In a bid to support the beleaguered wine industry, the European Union announced measures to boost tourism and marketing efforts while reducing bureaucratic red tape for producers. Nonetheless, uncertainty reigns as to how Trump’s administration will proceed with further tariff implementations, with speculation of an indeterminate 25 per cent tariff looming over all EU imports, which would also encompass wines.
Given the ambiguity surrounding Trump’s trade strategies, Auray reflected on the difficulty in forming adaptive business strategies: “How can you find a strategy for someone who has none — because [Trump] has no strategy.” This unpredictable environment leaves producers feeling as if they are navigating “quicksand” with their futures delicately hanging in the balance.
Economist Anne-Sophie Alsif suggested that Trump’s tariff strategy might be a broader attempt to leverage negotiations over EU regulations on U.S. tech companies. The longstanding tension arises from Europe’s aggressive stance against U.S. tech giants like Google and Apple, marking a pivot in trade dialogues that include both technology and agriculture sectors.
As the trade disputes widen, Canada and European nations have aligned against the U.S. tariffs but with different perspectives. Canadian Prime Minister Mark Carney stated that Canada would pursue its own retaliatory measures that deliver minimal impact domestically while aiming for maximum pressure on the U.S. market. Trump reacted to this alignment by equalising the Canadian position with the EU regarding tariffs, warning that combined efforts to undermine U.S. economic interests could prompt harsher tariffs.
Faced with these challenges, some French wine producers like Marin Stoffer, from champagne maker Roger-Constant Lemaire, are exploring alternative markets, targeting cities like Calgary and Vancouver in Canada. However, Stoffer acknowledged the lengthy and often fruitless process of establishing new distribution networks—especially with the U.S. remaining a primary market for French champagne.
The sentiments reflect growing unease within the French populace regarding their relationship with the U.S., with Roland Lescure, a deputy in the French National Assembly, noting a palpable shift in perception towards the U.S. “Only 20-plus percent of French people truly believe that the U.S. is their ally,” he remarked, underscoring the significant implications Trump’s trade policies might have on international relations. Lescure articulated the importance of navigating these tensions with care, advocating for firm negotiations to avoid a comprehensive trade war that could have widespread repercussions for all involved.
Source: Noah Wire Services
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