Withering on the vine? Hardly. Canada’s wine industry thrives as restrictions on U.S. alcohol market take effect

FRUITVALE, B.C. – Trevor Miller paused a moment in the April sunshine to wipe his brow before kneeling in the dirt to bury another plant stem and pat it down with wood chips.

The bare root seedling poking a few inches out of the ground is a riesling vine imported from a grower in Washington state.

Miller was nervous when he ordered the batch for replacement planting at Mountain Soul Vineyard and Winery about 5 miles north of the U.S. border above Stevens County. He wasn’t sure if the vines would be tariffed by the Canadian government. Fortunately, they weren’t.

“Tariffs are not good for anything, but as for the wine industry, it has done well for us so far,” Miller said.

Since British Columbia and most other provinces stopped importing U.S. alcohol in response to U.S. tariffs, local demand for Miller’s boutique wine has flourished at restaurants and liquor stores.

“I’ll be honest, it’s been quite good for us,” Miller said.

Orders are up in both speed and quantity, and have doubled for a few distributors as more consumers ask to buy Canadian. Even some Americans are crossing the border to support Canadian products, Miller said.

He is keeping up with demand so far. Rather than expanding to new markets, he’s focused on keeping the shelves stocked for his existing customers.

Although the 25-acre vineyard was planted a dozen years ago, Mountain Soul is still establishing itself after Miller bought the property in 2020. The wine industry is competitive, and it takes time to build loyalty. So, as wine drinkers switch from American brands, it’s an opportunity to grow his customer base. Miller hopes that loyalty continues when or if the tariffs go away.

Because he does not export, he is not directly affected by the U.S. tariffs. But the outlook isn’t all rosé.

If he has to buy supplies from America, his input costs will go up. For example, Canadian suppliers are selling out of bottles. And if general costs go up from inflation or a recession, those will be harder to absorb as a small producer.

Miller is saddened by the international conflict.

“It was nice to be able to have another country you could call a friend close to home,” he said. “I hope that comes again. I’m an optimist.”

U.S. alcohol is nowhere to be seen in the provincial government-owned BC Liquor store in nearby Salmo, British Columbia. But the shelves are not empty. They have been replaced by other categories, including labels for “100% British Columbia Wine” and “Only @BCL” for beverages distributed exclusively by the provincial government.

Signs in the window and around the store say, “Buy Canadian Instead.”

While U.S. alcohol was pulled from the shelves of government stores, private liquor stores and bars are allowed to sell what they have until they run out. The independently owned Silver Dollar Liquor Store a block away continues to sell staple American whiskeys Jack Daniels and Jim Beam.

Manager Chalise Bonderoff said the store has not changed its prices and still sells American booze at a steady rate, though more people are asking for Canadian options.

Back at the BC Liquor store, Luis Perez, who was buying a six-pack of beer, said he doesn’t drink much, but he has noticed prices going up.

“The government is encouraging us to buy more Canadian, so that’s what we’re doing,” Perez said.

Many wines sold at BC Liquor are not technically 100% Canadian, because although they are fermented or bottled in Canada, they use grapes from other countries, including the United States.

Early last year, a deep freeze killed much of the grape crop in British Columbia, and many wineries bought grapes from Washington.

Chris Stone, deputy director of the Washington State Wine Commission, said grape sales are not typically a major export, but last year approximately 5,000 tons (out of 150,000) went to Canada. Grape sales for the 2025 harvest season are uncertain.

But Canada is Washington’s largest export market for finished wine, about $12 million a year.

“It literally disappeared overnight,” Stone said. “We’ve been completely shut out.”

Of all Washington wine, only about 5% is exported to other countries, but it was an area of growth and opportunity before the trade war began, Stone said. The wine commission was working to open new markets in Asia and Europe, yet that is all on hold until uncertainty about final tariff rates resolves.

“People are in a wait-and-see mode to see how long this persists,” Stone said.

Dry Fly Distilling, based in Spokane, was looking into exporting to Canada before the market dried up, so that process is on hold, minority owner and president Patrick Donovan told The Spokesman-Review in March.

Another Washington product under threat is hops, widely grown in the Yakima Valley and used for beer brewed in Canada, though countertariffs have not yet been imposed on them. Washington exported $36 million worth of hop cones and extracts to Canada in 2023, according to the Washington Department of Agriculture.

Marty Clubb, owner and managing winemaker of L’Ecole No 41 in the Walla Walla Valley, said the winery has exported to Canada for 25 years.

About 1,000 cases a year to Canada makes up about 3-4% of business, with 5-7% for total international sales.

“Not huge, but in the face of a market downturn – in wine, every little bit adds up,” Clubb said. “Definitely not good timing for a recession.”

Despite being closer to British Columbia, L’Ecole has a stronger relationship with Québec because of area ties to the Hudson’s Bay Company. L’Ecole is headquartered in an old schoolhouse in historic Frenchtown, just west of Walla Walla, that was founded by Canadian fur traders in the early 1800s.

“That connection to French Canadian history gave our brand momentum in that province,” Clubb said.

Besides Canada, he also lost his market in Denmark, not only because of tariffs, but from President Donald Trump’s threats of annexing Greenland.

Clubb said even if the trade conflict resolves soon, resentment toward the U.S. and its commodities will linger.

“The idea of tariffs was a failed policy 125 years ago,” Clubb said. “It’s not a good policy for business, I can tell you that.”