BREAKING: Canada’s Bourbon Boycott Just CRUSHED U.S. Whiskey Exports… What’s Next?

Added: 2026-05-09

[00:00:00]Canada's trade war with the US is having a real impact on the alcohol industry south of the border. The Distilled Spirits Council says it saw a 63% drop in exports to Canada in 2025. It blames the bans on American liquor in most Canadian province. US alcohol exports to Canada were way down last year, more than 60%. Well, that comes amid a ban on American booze in Ontario and several other provinces. CTV's Judy Trinh joins us with more on this. Judy, how has the tariff war impacted the industry so far?

[00:00:34]The short answer is a lot. Jamie, you know, since the alcohol ban by eight out of 10 Canadian provinces was imposed last March, the US distillery market says it's seen a 63% drop in exports to Canada.

[00:00:52]>> Canada just made a move that shocked America's whiskey business. Stores across Canada pulled US alcohol off shelves, helping local Canadian brands grow fast while US whiskey sales crashed hard. What started as a trade fight is now turning into a huge loss for American companies.

[00:01:08]In less than 12 months, one of America's largest whiskey export markets sharply contracted. By the end of March 2026, industry groups reported that US liquor exports to Canada had fallen by 63% after multiple Canadian provinces removed American alcohol from government-controlled retail systems.

[00:01:29]The disruption followed retaliatory measures linked to US tariffs introduced during the renewed trade dispute between Washington and Ottawa. Provincial liquor agencies across Canada moved quickly. In Ontario alone, one of the world's largest alcohol buyers, stopped purchasing US products through the LCBO network. The impact spread through the North American spirits sector within weeks.

[00:01:50]Canada has historically ranked among the top foreign destinations for American whiskey and bourbon exports. Provincial liquor boards in Ontario, British Columbia, Quebec, Nova Scotia, Manitoba, Newfoundland and Labrador, and Prince Edward Island either removed American products from shelves or suspended new purchases. Since those agencies control most alcohol distribution inside Canada, the restrictions immediately reduced access to American brands across thousands of retail locations.

[00:02:20]A US industry body informed the Trump administration that trade friction between both countries had already caused job losses inside the alcohol industry. The Distilled Spirits Council of the United States stated that exports collapsed after provincial bans were introduced in response to US tariffs on Canadian goods.

[00:02:40]Reuters later reported that sales of US spirits inside Canada dropped 66.3% between March and the end of April 2025 alone. The pressure became visible inside Kentucky, where bourbon production supports thousands of jobs.

[00:02:55]Kentucky distillers had warned in early 2025 that retaliatory actions from Canada could heavily damage the industry. Eric Gregory, president of the Kentucky Distillers Association, said retaliatory measures would have far-reaching consequences across Kentucky, home to 95% of the world's bourbon. Several American companies later confirmed major declines in Canadian sales. Brown-Forman, the producer behind Jack Daniel's, reported that Canadian sales dropped approximately 60% during the boycott period. Phillips Distilling, based in Minnesota, disclosed an even steeper decline. Its Canadian business reportedly fell roughly 70% after provincial restrictions intensified.

[00:03:38]According to company CEO Andrew England, the losses represented about 15% of the firm's branded business. The company later shifted production of its Sour Puss brand to a contract manufacturer in Montreal to maintain access to Canadian consumers. The structure of Canada's alcohol market amplified the damage.

[00:03:57]Unlike the United States, most Canadian provinces operate government-run liquor monopolies. That system allowed provincial governments to remove American alcohol almost immediately without waiting for individual retailers. Ontario's LCBO network became central to the dispute because of its enormous purchasing power. Reports earlier in 2026 estimated Ontario had imported roughly 965 million Canadian dollars worth of American alcohol before restrictions were introduced. At the same time, the boycott aligned with a wider Buy Canadian campaign that accelerated after tariffs returned to the center of Canada-US trade negotiations. Canadian consumers increasingly shifted toward domestic whiskey, wine, and beer brands.

[00:04:43]Provincial governments publicly promoted Canadian-made alternatives while retailers highlighted local products through shelf placement and advertising campaigns. The movement extended beyond alcohol. Canadian consumers also reduced US travel bookings and purchases of several American goods during the tariff dispute. The US Trade Representative later identified provincial liquor policies as a major trade barrier. A 2026 USTR document argued that restrictions imposed by provincial liquor control boards greatly hamper exports of American wine, beer, and spirits into Canada.

[00:05:16]The report specifically demanded that American alcohol return immediately and permanently to all Canadian markets.

[00:05:24]However, Canadian provincial leaders maintained that the restrictions were directly connected to ongoing US tariff policies.

[00:05:32]Ontario Premier Doug Ford became one of the most vocal supporters of maintaining restrictions.

[00:05:38]In April 2026, Ford stated that American alcohol would only go back on shelves when the US removes its tariffs.

[00:05:46]Ontario continued to keep many American products out of LCBO stores despite mounting pressure from US producers and trade officials. Provincial governments argue that alcohol restrictions remained one of the few direct economic responses available against American tariffs. Some provinces later adjusted portions of the ban without fully restoring imports.

[00:06:07]Quebec announced in early 2026 that it would temporarily place existing US inventory back on shelves to prevent millions of dollars worth of alcohol from expiring in storage. Quebec Finance Minister Eric Girard described the move as an exceptional measure while emphasizing that the province still prohibited new American imports. Profits from those sales were directed toward food banks and charitable programs.

[00:06:33]Other provinces adopted similar approaches. Manitoba, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador introduced programs allowing some previously imported stock to be sold while directing proceeds toward charities and food assistance organizations.

[00:06:49]Ontario remained more restrictive, reportedly holding nearly 80 million Canadian dollars worth of US alcohol in storage facilities without returning products to shelves.

[00:07:01]Meanwhile, Alberta and Saskatchewan diverge from most Canadian provinces.

[00:07:06]Both provinces resumed US alcohol imports after initially participating in restrictions.

[00:07:11]Alberta officials later described the decision as part of a renewed commitment to open and fair trade with our largest partner. Because both provinces rely more heavily on privatized retail systems, provincial governments there face fewer centralized controls over alcohol distribution compared to Ontario or Quebec. Despite limited easing measures in some regions, export data continued showing severe damage to American liquor shipments entering Canada.

[00:07:38]Reports published in 2026 indicated that US spirits exports to Canada during portions of 2025 fell below $10 million in quarterly value after previously reaching far higher levels before the trade conflict.

[00:07:54]The decline represented one of the largest disruptions to the North American alcohol trade in decades.

[00:07:59]Industry organizations on both sides of the border warned that long-term market shifts may already be developing.

[00:08:05]Spirits Canada stated that removing US products from stores was deeply problematic for spirits producers on both sides of the border.

[00:08:13]Canadian retailers expanded domestic product lines while many consumers became more familiar with local whiskey producers during the boycott period.

[00:08:22]American distillers now face uncertainty over whether lost shelf space and consumer loyalty can fully return even if trade tensions eventually cool.