What Do Tariffs Mean for Scotch?

Tariffs have been the source of significant discussion when it comes to wine (and cheese, and olive oil), but we’ve seen less discussion about how they’ll impact the spirits market, especially when it comes to single malt scotch. The 25% tariff on single malt scotch went into effect on October 18th, right alongside wine and other European goods, and a vote last week saw it continue further into the new year. Without getting too into the political weeds, I wanted to discuss briefly the very real way this will impact the prices you, the consumer, pay for single malt scotch.

What will happen in the immediate future?

• Prices WILL go up, if they haven’t already.
  I’ve already heard stories of huge price increases on well-known commercial favorites such as Lagavulin 16, and I’ve seen giant price increases from wholesalers on cult-classics like GlenDronach 18. But this phenomenon won’t be limited to any one distillery or bottling. All single malts are subject to the same tariff, and the vast majority of prices will jump.
• Independent distilleries, bottlers, and retailers will be hurt the most.
  The big commercial scotch distilleries are largely owned by corporations with ownership outside of Scotland—for instance: Diageo, Brown-Forman, and Suntory Jim Beam—and because these corporations own so many spirits brands from all over the world, their portfolios and importing structure has space to absorb some of the tariff blow without passing it along to the consumer, should they see fit. Plus many of their well-known single malt brands have prices inflated by marketing, rather than by intrinsic value, and there is room to account for the 25% tariff to some degree. Not so for the small independent distilleries we champion, who already have a hard time fighting for shelf space and brand recognition, despite frequently making far superior whisky. Many of these distilleries simply don’t have the means to absorb a large financial blow, and if these tariffs continue for a long time, we will likely see a major negative impact.
• The next review of these tariffs isn’t until August 17th, so for now this remains the status quo.
  Until then, we don’t expect any change to the tariff structure—and by that point, the vast majority of scotch for sale will have been subject to the 25% tariff, with higher prices that reflect that change.

What are we going to do about it at Amanti Vino?

• We won’t arbitrarily raise prices.
  Any price increase you see on our shelf will reflect a price increase at wholesale the next time we order—we will absolutely not raise any prices on scotch pre-emptively or due to speculation. Some in-demand distilleries, such as Springbank, have been out of stock in the United States for months and will definitely see significant price jumps when they become available again. (We’ll cross that bridge when we come to it.) Others, such as Kilchoman, have committed over the past few months to absorbing the impact of the tariffs themselves to keep pricing stable as long as possible in the United States. But they simply cannot afford to do this forever.
• We’ve already stocked up on bottles still available at pre-tariff pricing.
  Scotch doesn’t sell like wine, which is precisely why you haven’t seen prices go up on every single bottle already. Some distributors still have stock left from certain distilleries at pre-tariff pricing, and I’ve made an effort to stock up as much as I can on Amanti favorites such as GlenAllachie, Hazelburn, and Kilchoman, as well as bringing in a handful of under-appreciated independent bottlings from Douglas Laing, Port Askaig, and Gordon & MacPhail. In many cases, however, I’ve tried to order more of certain products than was available, so quantities at old pricing are definitely limited.

The impact of these trade wars will be interesting (and potentially even more damaging to retailers and producers stateside) as European and Asian countries retaliate with increased tariffs on bourbon and other American spirits—just last year, European imports of American spirits dropped by a whopping 27%, a keen loss felt across the country but especially by distilleries in Kentucky, where the popularity of hard-to-find bourbons from distilleries like Buffalo Trace and Heaven Hill have seen a great increase of interest and demand for American whiskies in recent years. What the impact of these losses will mean for whiskey fans in American remains to be seen—but I find it hard to believe there won’t be a significant impact to the market.

In any case, we’re doing what we can at Amanti Vino to keep prices and availability steady for as long as possible—I’m researching constantly, tasting new spirits every single week, and ordering more single malt scotch than we ever have before. My advice to you: stock up while you still can!

If you’d like a recommendation (for yourself or whisky enthusiast loved one) please don’t hesitate to give us a call or email me at jacob@amantivino.com. Also, feel free to browse some of the most limited options we have in stock, featured below. Odds are that single malt prices will only be higher by the next holiday season, so time is of the essence!