Press Release
Posted:
Washington – Reps. Mike Thompson (CA-04) and Dan Newhouse (WA-04) led over 60 members of Congress on a letter to United States Trade Representative (USTR) Ambassador Katherine Tai on concerns about the challenges U.S. wine producers face in critical export markets around the world, including the key growth markets of India, China and Vietnam. The letter asks USTR to commit additional resources to expand access to critical markets for high value exports like wine.
“Wine is one of the most sustainable, high value-added agricultural products grown in the U.S. adding more than $170 billion annually to the national economy and supporting 1.1 million jobs across the nation,” the members wrote. “U.S. wine exports have seen an unfortunate decline in value over the last six years due to numerous factors including retaliatory tariffs and the coronavirus pandemic.
“As you work to expand U.S. agricultural exports, we ask that USTR commit additional resources to expand access to critical markets for high value exports like wine. We recognize that the administration is not pursuing traditional comprehensive market access agreements at this time but urge you to launch targeted efforts to address the competitive disadvantage faced by U.S. wine producers.”
“Expanding export opportunities is a top priority for our wineries so it is very encouraging to see the broad support within Congress for these efforts,” said Robert P. Koch, President and CEO of Wine Institute. “We look forward to continuing to work with the Congressional Wine Caucus and the administration to level the playing field for U.S. wineries throughout the world.”
The full letter can be read here and below.
Dear Ambassador Tai:
We are writing on behalf of the Congressional Wine Caucus to raise concerns about the challenges U.S. wine producers face in critical export markets around the world. In many of the fastest growing wine markets, the playing field is tilted heavily against U.S. producers. We urge you to redouble USTR’s efforts to remove tariff and non-tariff barriers for U.S wine producers in key markets.
Wine is one of the most sustainable, highly value-added agricultural products grown in the U.S. adding more than $170 billion annually to the national economy and supporting 1.1 million jobs across the nation. U.S. wine exports have seen an unfortunate decline in value over the last six years due to numerous factors including retaliatory tariffs and the coronavirus pandemic. Despite some recent recovery, U.S. wine exports are still well below their peak of $1.62 billion in 2016. The global wine trade is still struggling to recover from these challenges as historically strong wine markets like the U.S. and European Union have seen flat to declining growth.
Challenging market conditions in numerous established wine markets are forcing U.S. wine producers to look to developing markets for growth. Many of these countries present numerous trade challenges that greatly increase the cost of entering the market. At the same time, competitors from wine producing regions are gaining favorable market access terms through trade agreements. Here are just a few examples of the challenges U.S. wine producers face:
• In India, U.S. wines are subject to a 150 percent tariff in addition to numerous non-tariff measures in this fast-growing market. Australia recently completed a trade agreement with India which lowers the tariff on premium Australian wine to 75 percent immediately and 25 percent in the future.
• Currently, Vietnam applies a 50 percent tariff on U.S. wine while wine from competitors in the European Union, Australia, New Zealand, and Chile will soon pay a 0 percent tariff.
• U.S wines continue to be targeted by retaliatory tariffs in China as a result of U.S. actions on Sec. 232 and 301 tariffs. U.S. exports face a 54 percent tariff, while wines from the EU pay 14 percent and wines from New Zealand and Chile pay 0 percent tariff.
As you work to expand U.S. agricultural exports, we ask that USTR commit additional resources to expand access to critical markets for high value exports like wine. We recognize that the administration is not pursuing traditional comprehensive market access agreements at this time but urge you to launch targeted efforts to address the competitive disadvantage faced by U.S. wine producers. Doing so is critical to ensuring the long-term sustainability of this iconic and valuable agricultural product and the many benefits that it brings to our communities.