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What the collapse of trade talks means for U.S. alcohol sales · INSIGHT TODAY

• 0:00
  Speaker 1: All right.
• 0:00
  Speaker 2: One of the demands from the US was to end
• 0:02
  Speaker 2: the booze ban on US liquor, because alcohol has taken
• 0:04
  Speaker 2: center stage of this entire trade negotiation.
• 0:07
  Speaker 1: So now that the trade.
• 0:08
  Speaker 2: Talk is suspended, how's the alcohol and spirits industry in
• 0:11
  Speaker 2: the United States reacting to this news? For that, we've
• 0:14
  Speaker 2: reached Chris Swanger in Washington. He is a president and
• 0:16
  Speaker 2: CEO of the Distilled Spirits Council of the United States.
• 0:20
  Speaker 1: Chris Marr's good to see against her.
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  Speaker 2: I think last time we spoke you mentioned you weren't Democrat,
• 0:23
  Speaker 2: you weren't Republican.
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  Speaker 1: You were the party party, even more or less, the
• 0:28
  Speaker 1: cocktail party. That's what it was. How are you feeling today?
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  Speaker 2: I might have had a few cocktails, but I don't
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  Speaker 2: know if it would have been a party.
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  Speaker 3: Sure. Well, look on behalf of the Distilled Spirits Council
• 0:41
  Speaker 3: of the United States, and I had the privilege of
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  Speaker 3: representing many great Canadian spirits brands as well. Down in
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  Speaker 3: the dumps. I have to say, really really disappointed. We
• 0:54
  Speaker 3: had high hopes leading up to late yesterday afternoon, and
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  Speaker 3: then obviously the news broke. So this is devastating. It's
• 1:03
  Speaker 3: been devastating for the US distilled spirits industry over the
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  Speaker 3: last year and a half, as many of the provinces
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  Speaker 3: have stopped the purchase of American distilled spirits. And we
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  Speaker 3: wake up this morning with a fifty percent tariff being
• 1:23
  Speaker 3: imposed on Canadian distilled spirits, and it's going to be
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  Speaker 3: brutally hard for our friends and our colleagues in Canada,
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  Speaker 3: where the United States represents ninety three percent of the
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  Speaker 3: market for Canada. So we hope, hope that the government
• 1:42
  Speaker 3: leaders on both sides of the border can find a resolution.
• 1:47
  Speaker 2: Look, the economic courage of all of this is pretty
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  Speaker 2: obvious to anyone who pays attention to the data. That
• 1:53
  Speaker 2: is not what is the stock market at today right
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  Speaker 2: People are losing jobs, People are losing money.
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  Speaker 1: Kentucky, Tennessee.
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  Speaker 2: You know a lot of the key distilling economies and
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  Speaker 2: states are getting absolutely hammered by this. So why is it,
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  Speaker 2: you know, Chris Wander, do you have any better insight
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  Speaker 2: as to why the US administration just kind of doesn't
• 2:14
  Speaker 2: see it that way? Because we keep hearing the President
• 2:16
  Speaker 2: saying tarras are making us richer and the economy is
• 2:18
  Speaker 2: doing great, and that's just not what's happening.
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  Speaker 3: Yeah, well, again, we've lost seventy three percent of our exports.
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  Speaker 3: The United States year on year, in normal times would
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  Speaker 3: export about over two hundred and twenty plus million annually
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  Speaker 3: to Canada and American distilled spirits products, and in return,
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  Speaker 3: Canada exports over five hundred million in Canadian distilled spirits products.
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  Speaker 3: You know, American consumers and American citizens love our friends
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  Speaker 3: in Canada, and American consumers appreciate and love Canadian distilled
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  Speaker 3: spirits products. So when you apply fifty percent tariff on
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  Speaker 3: that five hundred plus million in revenue coming into the
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  Speaker 3: United States, it's going to be pretty devastating. And you know,
• 3:19
  Speaker 3: we have felt the brunt of that pain, certainly on
• 3:21
  Speaker 3: the US side, and I think economic carnage is a
• 3:26
  Speaker 3: good way to put it. And you know, unfortunately, our
• 3:30
  Speaker 3: industry should have never been involved. Obviously, there are high
• 3:34
  Speaker 3: octane politics at play and this administration, the US administration
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  Speaker 3: has a different view and bringing more American manufacturing back
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  Speaker 3: to the United States and so forth. But you know,
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  Speaker 3: under NAFTA, under USMCA, the hospitality economy in Canada and
• 3:54
  Speaker 3: in the United States thrived, and it has suffered mightily
• 3:58
  Speaker 3: over the last year and a half here in the
• 4:01
  Speaker 3: United States, great states like Tennessee and Kentucky, but even
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  Speaker 3: craft distillers all around the country have been hurting as
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  Speaker 3: a result of the provincial band and unfortunately, as a
• 4:16
  Speaker 3: result of what happened yesterday, the significant pain, you know,
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  Speaker 3: I worry is going to be imposed on the Canadian
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  Speaker 3: distilled spirits industry. And we're unique, we're intertwined, We're an
• 4:30
  Speaker 3: industry of one. So we hope, hope cooler heads will prevail,
• 4:35
  Speaker 3: get us back on the store shelves and hand it ultimately,
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  Speaker 3: and of course thwart that fifty percent tariff on Canadian
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  Speaker 3: spirits products as well, So just.
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  Speaker 2: On that's obviously the provincial governments and territorial government instead
• 4:48
  Speaker 2: have made the decision because they control the purchase of
• 4:51
  Speaker 2: alcohol and the sale of alcoholic our constitution in Canada.
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  Speaker 2: Even if you get the market access back, because that
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  Speaker 2: was seeming like a possibility at the middle of this week,
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  Speaker 2: right which is where your optimism came from, do you
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  Speaker 2: get the brand loyalty back? Because people are mad even
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  Speaker 2: if this goes away, They've found other options. They've made decisions,
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  Speaker 2: and you know, Canadians are seized with this on a level,
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  Speaker 2: I don't think your day to day American necessarily is right.
• 5:17
  Speaker 2: I mean, do you think they'll start buying again? Even
• 5:19
  Speaker 2: if you get back.
• 5:20
  Speaker 3: It's going to take It's going to take a while.
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  Speaker 3: There's no denying that. And even you know, having the
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  Speaker 3: privilege of participating in Canadian media, you know, I've been
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  Speaker 3: the brunt of some of those emotions. And again I'm
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  Speaker 3: not you know, I represent the distilled spirits industry on
• 5:39
  Speaker 3: both sides of the border. You know, I started my
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  Speaker 3: career having the privilege of representing Canadian Club out of Windsor, Canada,
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  Speaker 3: and so, uh, you know, it's it's unfortunate, but I
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  Speaker 3: recognize the emotions in Canada are very, very high, and
• 6:00
  Speaker 3: I've received some of those strong emotions directly from Canadians
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  Speaker 3: where I'm just kind of caught up on behalf of
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  Speaker 3: our industry or industry is caught up. Unfortunately, what has
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  Speaker 3: transpired over the last twenty four hours is going to
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  Speaker 3: be pretty significant to the Canadian distilled spirit economy as well.
• 6:22
  Speaker 1: Well.
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  Speaker 2: Look, I remember some of that blowback Chris Swanger, because
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  Speaker 2: I think one of the last times we had you
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  Speaker 2: on my show during the weekday and the coverage of it.
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  Speaker 2: You're really keen to get back on the shelves because
• 6:34
  Speaker 2: you're advocating for the economic interests of your members. And
• 6:39
  Speaker 2: we can understand that because and the Prime Innist talked
• 6:41
  Speaker 2: about this today, it goes we're taking this step reluctantly
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  Speaker 2: on the counterterers that they're going to unveil next week
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  Speaker 2: because we recognized it will raise costs for Canadians, but
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  Speaker 2: because we recognized some US companies and US states are
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  Speaker 2: innocent bystanders in a dispute they did not want and
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  Speaker 2: you would be in that category.
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  Speaker 1: Right. It's not like the Distill Spirits.
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  Speaker 2: Council of the United States was going to the White
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  Speaker 2: House and saying, you know what would be a good
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  Speaker 2: idea start a trade war with our biggest market.
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  Speaker 1: Your collateral damage and this just like ordinary Canadians.
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  Speaker 3: Are absolutely absolutely and look, we recognize when and if
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  Speaker 3: we ever get back on the shelves in Canada on
• 7:19
  Speaker 3: behalf of the US distilled spirits industry, you know it's
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  Speaker 3: going to be an incumbent on those great brands to
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  Speaker 3: work hard to try to earn the trust and respect back,
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  Speaker 3: and at some point we may never be able to
• 7:32
  Speaker 3: do that, but let Canadian consumers choose. But we are
• 7:37
  Speaker 3: and our industry, and I talk about our industry, the
• 7:41
  Speaker 3: Canadian and American spirits industry thrives with no trade barriers,
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  Speaker 3: no tariffs, and open markets. So we have a saying
• 7:53
  Speaker 3: we want to compete on sippentaste. And the industry is
• 7:59
  Speaker 3: great and has been great for both countries over the
• 8:03
  Speaker 3: last thirty plus years because they no trade bearers and
• 8:07
  Speaker 3: NAFTA and USMCA, and unfortunately, our industry got kind of
• 8:12
  Speaker 3: swallowed up in some of the broader issues and that
• 8:15
  Speaker 3: we recognize, you know, I got to stay in my lane,
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  Speaker 3: but recognize there's big issues related to dairy and autos
• 8:22
  Speaker 3: and steal aluminum. But our industry collectively is an unfortunate
• 8:28
  Speaker 3: victim and the pain's only going to get greater.
• 8:31
  Speaker 2: Well, that's just what I wanted to ask you. Is
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  Speaker 2: a final point, Chris Swannger, Because not only are talks
• 8:37
  Speaker 2: off negotiators back in Canada, counter tariffs going up and
• 8:41
  Speaker 2: support programs rolling out to weather the storm here in Canada.
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  Speaker 2: The Prime Minister talked a lot today about trust just
• 8:48
  Speaker 2: being gone. Signature is written in pencil and the reliability
• 8:51
  Speaker 2: that any new deal would endure. There's a real lack
• 8:54
  Speaker 2: of faith on the Canadian side that the Americans will
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  Speaker 2: be good to the word, because, let's face it, we're
• 8:58
  Speaker 2: in a war on a deal President negotiated himself back
• 9:01
  Speaker 2: in twenty eighteen. So when you look at being stuck
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  Speaker 2: in that dynamic as collateral damage, and I fully accept
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  Speaker 2: that it's the situation you're in. I mean, how much
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  Speaker 2: worse can it get for your industry in terms of
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  Speaker 2: job losses and maybe business closures.
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  Speaker 3: It's going to be significant because that fifty percent tariff
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  Speaker 3: applied on Canadian spirits coming into the United States ultimately
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  Speaker 3: impact that American consumer that enjoys a great Canadian whiskey.
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  Speaker 3: It's going to impact the bartender. It's going to impact farmers.
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  Speaker 3: You know, we have a sand grain to glass farmers
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  Speaker 3: in certainly Canada. So it's going to be across the
• 9:42
  Speaker 3: board pain and please let me just convey our industry
• 9:48
  Speaker 3: here in the United States will continue to aggressively make
• 9:52
  Speaker 3: the case to this administration and the industry will be
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  Speaker 3: the same I think in Canada to try to get
• 10:00
  Speaker 3: this industry out of these water issues because uh, you know,
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  Speaker 3: I think at one point we were thought to be
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  Speaker 3: maybe a leverage point and uh uh you know, we're
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  Speaker 3: caught up in that whirlwind and the economic pain is
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  Speaker 3: going to be significant for both countries.
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  Speaker 1: Yeah.
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  Speaker 2: One one person's leverage is another person's victim, right, And
• 10:20
  Speaker 2: this is the situation we're in as as this plays out.
• 10:24
  Speaker 2: Chris Swanger, I appreciate the time it was Chris Wanger
• 10:27
  Speaker 2: with the Stilled Spirits Council of the United States Regional Washington.
• 10:30
  Speaker 1: Thank you for enjoy the rest of your Saturday.
• 10:31
  Speaker 3: Hang in there. Cheers everyone, Thanks, Cheers,