America’s Canadian Exit, and The Foreign Companies Celebrating It
Source: Brasserie de Silly
America recently launched a trade war with the rest of the world—perhaps you heard. I haven’t heard anyone offer a convincing explanation for why President Trump chose Canada as one of his biggest targets in this war, but he has. Canada, our neighbor and best historic trading partner, reacted, with predictable results. At least over the second quarter of 2025 (after Trump levied the tariffs), it means Canadian liquor stores have more or less cleaned out their American stocks, and that hasn’t been great news for American beer, wine, and liquor manufacturers, who have seen their sales drop to zero. (The tariff drama continued this week, as we’ll discuss in due course.)
It hasn’t been all bad, though—at least if you are a purveyor of imported beer from countries who are not conducting a trade war. I recently got an email from the Belgian producer Brasserie de Silly, now keen to score some space on those empty shelves. Silly was founded in the Hainaut 175 years ago, and is taking advantage of the American exit to enter the Western Canadian market for the first time. Canadians could do a whole lot worse than discovering the ales made by this sixth-generation brewery, so this will be a treat for them. As Gary De Pape, who covers imports for British Columbia, told me during an exchange I had with him:
“I can say that everyone here in Canada is angry as hell at Trump, his wish for a 51st state and his tariffs. As you can imagine, these past few months have had Canadian imbibers willingly and gladly replacing Wild Turkey, Jack Daniels, Sierra Nevada Pale Ale, Deschutes Black Butte etc. with Canadian alternatives [and new imports].”
This wasn’t surprising to me, and it has been fairly widely covered. But trade wars are weird beasts, and Gary told me a few things I hadn’t considered. Americans may think that with normalized relations, the bourbon can begin flowing freely back into Vancouver. But that’s not how things work. No matter what happens going forward, the tariffs will have badly damaged a foreign market for American products.
I wanted to see the numbers. After I heard from Gary, I reached out to the British Columbia Liquor Distribution Branch (BCLDB) to learn more about how exactly the trade war has impacted American beer, wine, and liquor sales. After Trump initiated the American tariffs, Canada responded by blocking US booze imports—though in BC they allowed state-owned retailers to sell existing stock. Below are the figures for some of the product categories for the period of April-June of this year. Beer isn’t really a big player in these figures—Canada has their own robust market—but the hit to wine and liquor is more substantial. Again, these are figures only in British Columbia, not nationwide:
For the past four months, Canadians haven’t had a California Cabernets or Kentucky Bourbons to whet their whistle. During those four months, three things happened. One, as Gary’s email emphasized, was an opportunity for producers from other countries to get in on the action:
“I also see an opportunity in the market for the Belgian beers I am bringing into western Canada. My boss and co-owner of Brasserie de Silly in Belgium, Lionel Van der Haegen concurs. Lionel was quoted in a Belgian news article last month saying: ‘In these complex economic times, marked by uncertainty and tariffs brought on by the United States which is weakening the brewing sector, we have chosen boldness rather than caution, investment rather than wait-and-see.’”
California Cabernets, Oregon IPAs, and Kentucky bourbons are all world-class beverages, but they’re not irreplaceable. Companies spend years or decades building the reputation for these categories and promoting their own brands. Trump’s tariffs have interrupted the work of these industries, and now Canadians are playing the field and experimenting with other products—ones they may enjoy as much or more than the American ones they’re replacing. That’s the first dynamic at play.
The second is that now that those shelves are being filled by products elsewhere (whether domestic or imported), the U.S. companies will be forced to win them back should Canadians allow that, which as of this week they have agreed to do. This is a reality Chris Swonger, President and CEO of the Distilled Spirits Council, acknowledged: "This is a very positive sign, but until all the provinces put American spirits back on their shelves, it won’t have much of an impact.”
In the space of four months, every American company has ceded the hard-won space on Canadian shelves, and now they have to start all over again. And they must do it in an unstable environment in which the late-night whim of an American president may undo the current arrangement. Even if Canadian retailers want American products, they’re going to think twice about whether to stock them in place of more reliable alternatives from other parts of the world.
The final dynamic is the mood Gary mentioned in his first quote. Canadians don’t have to drink American products, and it’s hard to see why they would. With its tariffs, the U.S. has taken a hammer to the Canadian economy. Trump’s boorishness and bellicose language was offensive (that 51st state thing—oy!). Canadians overwhelmingly disapprove of Trump, and they’re not so hot on the U.S. anymore, either.
Even in a best-case scenario, with tariffs erased and relations back to a pre-Trump neighborly normalcy, the market for U.S. goods is just going to be weak in a country that views its neighbor as a pariah. And there’s no guarantee—or even suggestion—that the best-case scenario is likely. That’s great news for breweries like Silly, but not so much for American companies, whose brand is already permanently damaged.
Of course, Canada isn’t the only country affected by American tariffs—the rest of the world is, too. While our products are mostly still available elsewhere, many of these same dynamics will affect the pull of the American brand. Reversing matters will take a lot longer than four months.