Kentucky bourbon distilleries are struggling due to tariffs and trade wars with Canada and the European Union. The US imposed a 25% tariff on Canadian whiskey last week, prompting the EU to retaliate with its own tariffs, including a potential 50% penalty on American whiskey.
Brough Brothers Distillery, a Black-owned distillery in west Louisville, was planning to expand into Canada but now faces uncertainty due to the trade war. Victor Yarbrough said the back-and-forth between countries is causing more harm than the tariffs themselves.
The industry’s reliance on international sales makes it vulnerable to trade disruptions. According to Jason Bailey, head of the Kentucky Center for Economic Policy, a 50% tariff would be devastating, as most bourbon comes from Kentucky and has deep American roots.
The Kentucky Distillers Association estimates that retaliatory tariffs have cost the industry over $500 million in exports since 2018. If imposed, these tariffs would significantly impact distillery workers, farmers, truckers, and hospitality staff who depend on bourbon sales.
Despite the uncertainty, Brough Brothers remains committed to producing its bourbon, vodka, rum, and gin for US markets, exploring alternative opportunities and expanding into new states.
Source: https://www.lpm.org/news/2025-03-14/bourbon-distilleries-in-kentucky-are-in-limbo-as-tariffs-and-trade-wars-impact-the-industry