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Understanding the impact of tariffs on the Canadian alcohol market
Recently, Canadian retailers have started to remove American alcohol from their shelves, a direct response to the tariffs imposed by former U.S. President Donald Trump. This decision has left many independent businesses in Canada grappling with uncertainty.
The alcohol industry, which has long relied on cross-border trade, now faces a pivotal moment that could redefine its landscape.
The perspective of small business owners
Shawn Moen, CEO and co-founder of 9 Mile Legacy Brewing Company, reflects on the challenges of being a small business owner in these turbulent times.
“Five years ago, I was becoming an expert on virology during a global pandemic,” he states. “Today, I’m navigating the complexities of tariffs in a sovereignty crisis.” This sentiment resonates with many in the industry who feel the weight of economic pressures and the need for strategic adaptation.
Local production and the need for investment
While the removal of trade barriers is a step forward, Moen emphasizes that it is not a panacea for the challenges faced by Canadian breweries. “We grow the best barley in the world, but most of our production materials come from outside the province,” he explains.
The reliance on imported materials, including cans from the U.S., highlights the urgent need for investment in local processing and manufacturing. “This has been a wake-up call to support our local sectors,” he adds.
Policy changes for a thriving local economy
Mark Heise, president and CEO of Rebellion Brewing, echoes Moen’s concerns regarding the need for supportive policies. He argues that simply removing trade barriers is insufficient without creating an environment that fosters local businesses. “You can have all the slogans about shopping local, but without real policy support, it’s a constant struggle for survival,” Heise asserts.
The diverse alcohol policies across provinces complicate the situation further, necessitating a coordinated approach to support local economies.
The future of the Canadian alcohol industry
As the Canadian alcohol industry navigates these changes, the focus on local production and supportive policies will be crucial. The challenges posed by tariffs are significant, but they also present an opportunity for growth and innovation within the sector. By investing in local resources and advocating for favorable policies, Canadian breweries can not only survive but thrive in this evolving landscape.
