How much damage have Canada’s booze bans done to the U.S. wine industry?

As we head into the Victoria Day long weekend, one of the busiest booze-buying weekends on the calendar, it’s the second year where most Canadians are without access to American labels.

When Canadian liquor stores pulled American products from shelves in early 2025, it delivered a bruising to the U.S. wine industry, and data shows just how much of a headache the booze ban has been for the U.S. as the two countries are set to begin free trade talks later this year.

According to trade data from the U.S. Census Bureau, wine exports from the U.S. to Canada dropped by $343 million US between 2024 and 2025, a devastating blow to the American wine industry. That represents a 77 per cent year-over-year drop in wine exports to Canada, which was previously the largest buyer of U.S. wine.

Since March 2025, American alcoholic beverages have been absent from the shelves of almost all liquor stores across the country in retaliation for U.S. President Donald Trump’s tariffs. An exception is in Alberta and Saskatchewan, where some sales have resumed due to the privatization of liquor stores in those provinces.

According to a recently published report, the U.S. earlier this year identified the alcohol ban as one of several sticking points for upcoming trade talks. Other issues mentioned in the report include supply management, procurement policies and the Digital Services Tax.

“The United States continues to raise serious concerns regarding these actions and to press Canada to ensure that U.S. alcohol beverages immediately and permanently return to all provincial and territorial markets,” the report read.

After Canada, the next largest drop in U.S. wine exports was to China, by $69 million US, underscoring just how large Canada’s impact has been on the wine trade.

Data shows winemakers in the U.S. found other international customers, with export bumps to places like South Africa, Belgium, Japan and the United Arab Emirates. The increase, however, was nowhere near enough to counteract the significant decline seen in other countries.

Before the trade battle, American wine exports had already seen recent declines, with global exports (excluding Canada) dropping by 18 per cent between 2022 and 2023.

The tariffs and trade war isn’t the only situation impacting U.S. wineries; the industry as a whole is also wrestling with a global demand slump. Winemakers are selling to a shrinking market. They face increased competition from ready-to-drink cocktails and seltzers on liquor store shelves. At the same time, generational trends and rising concerns about the health risks associated with alcohol consumption are leading to a decrease in overall sales.

“Fewer U.S. consumers see wine as their preferred alcoholic beverage,” reads a pre-trade-war report from Silicon…