Catoctin Creek Distilling Co. in Purcellville, Virginia is working to boost its international deals, but looming threats of tariffs are already impacting business.PURCELLVILLE, Va. — If you ask Scott Harris, getting to work on whiskey every day is a far cry from his days as a government contractor. Since opening Catoctin Creek Distilling Company in Purcellville, Virginia with his wife 16 years ago, Harris has been working to expand internationally, but it appears his vision is happening during the wrong administration.Pre...
Catoctin Creek Distilling Co. in Purcellville, Virginia is working to boost its international deals, but looming threats of tariffs are already impacting business.
PURCELLVILLE, Va. — If you ask Scott Harris, getting to work on whiskey every day is a far cry from his days as a government contractor. Since opening Catoctin Creek Distilling Company in Purcellville, Virginia with his wife 16 years ago, Harris has been working to expand internationally, but it appears his vision is happening during the wrong administration.
President Donald Trump argues he wants to improve the U.S. economy by imposing tariffs on some of the nation's biggest partners, including Canada and Mexico. He agreed to pause his tariff threats for 30 days as negotiations continue.
However, the plan to boost American production by cracking down on international competition is sowing doubt among business leaders, distributors and importers.
“In the past year-and-a-half, about 18 months, we’ve been reinvesting in Mexico with sales, marketing and education events,” Harris said. “With threats of possible tariffs with Mexico, that put a pause on all the work we’ve done. Just the thought that there might tariffs is enough to basically stop them from wanting to do business. They’ve become reluctant to invest hard in our products.”
The impact on the industry is reminiscent of a similar trade war during Trump’s first term when he imposed tariffs on steel and aluminum imports. The European Union responded with a 25% retaliatory tariff on American whiskeys.
The EU is the largest export market for U.S. spirits, according to the Distilled Spirits Council of the United States. The U.S. exported $2.2 billion in 2023, up 8% compared to the previous year.
Catoctin Creek was making progress in its European markets. Prior to the tariffs during the first Trump administration, the business saw 11% of its revenue from exports to Europe. After the tariffs were placed, it dropped down to practically zero.
“We had a nice growing business in Europe and that business today is zero,” Harris said. “The tariffs basically gave not just higher prices for our products, but it gave the European craft distillers to catch up where we were in the market before them, and it increased a negative mindshare in Europe of American products coming over.”
Trump announced more plans to impose higher tariffs on steel, aluminum, lumber, cars, and pharmaceuticals.
George Mason University Professor of Economy Alex Tabarrok joins other experts by warning the administration what terms could mean in the long run.
“The tariffs on these goods are making it more difficult for the American firms to not only sell, but it’s raising the costs so they’re finding it more difficult to export as well," Tabarrok said. “It would be a terrible mistake for the United States to now corrupt and pull apart the international order because it’s good for us."