American Whiskey Wants to Be the World's Whiskey. The Tariff Wars Have Other Ideas.
There is a boldness to the mission statement of the American Whiskey Association that could easily read as naïve given the current global trade climate. The organization, founded in 2025 by some of the most powerful names in spirits, has set its sights on nothing less than making American whiskey — bourbon, rye, Tennessee whiskey — the defining spirit of the world. That ambition runs headlong into a thicket of retaliatory tariffs, trade bans, political brinkmanship, and a domestic market that is, for the first time in a generation, showing its age. What happens next will define not just an industry, but the cultural reach of one of America's most enduring exports.
A New Organization Enters a Complicated Moment
The American Whiskey Association was founded with a coalition of leading producers, including Brown-Forman, Suntory Global Spirits, Sazerac, Campari, Pernod Ricard, and Diageo, with the explicit aim of positioning American whiskey as "the world's whiskey." The ambition behind that phrase is not rhetorical flourish — it is a strategic directive, one that requires winning market access in countries where American spirits currently face prohibitive taxation, and doing so while navigating the most volatile trade environment the industry has faced in decades.
The AWA appointed Michael Bilello as its first Chief Executive Officer, marking a significant milestone for the trade association founded in 2025. Bilello brings more than 20 years of experience in leadership, strategic communications, and public affairs, most recently serving as Executive Vice President of Strategic Communications and Marketing at the Wine & Spirits Wholesalers of America. His background is not in distilling — it is in making the case for industries under pressure, which turns out to be exactly the job description he inherited.
Bilello said he was "excited to represent the American whiskey industry globally," adding that his priorities will include category recognition, market access, fair competition, and consumer engagement. Those four pillars sound measured, but in practice they describe a set of fights that are anything but. Fair competition, in particular, is a phrase loaded with meaning when American whiskey sits behind tariff walls in nearly every major growth market on earth.
The Man Behind the Mission
"The mission of the American Whiskey Association, as a global trade organization, is simple, exciting, and inspirational," Bilello has said. "It is to make American whiskey the world's whiskey. And the way we're going to do that is by protecting, promoting, and leading American whiskey." The founding member roster reads like the who's who of global spirits conglomerates — companies with deep pockets and global distribution arms already in place. What they lacked was a unified American whiskey voice, a single advocacy body specifically devoted to this category on the world stage. The AWA is that body.
The AWA represents an industry that produced approximately $5 billion in revenue in 2025, with approximately 2,300 distilleries in the U.S., and accounted for more than half of all U.S. spirits exports. That last figure requires an asterisk, though, because it was true before 2025's trade disruptions eroded American whiskey's share of the export ledger faster than any downturn since the early 2000s.
The Numbers That Reframe Everything
Any honest accounting of where American whiskey stands globally has to start with the 2025 export data, which landed like a gut punch across the entire industry. At $1.08 billion, American whiskeys remained the most exported category of U.S. spirits by far, despite registering a 19% decline from 2024. Holding the top spot while hemorrhaging nearly a fifth of your export value is a strange kind of distinction. It speaks more to how far American whiskey had climbed during the boom years than to any current strength.
U.S. spirits exports declined 3.8% to $2.37 billion in 2025 amid ongoing trade friction, domestic and international economic headwinds and retaliatory actions that disrupted access to key established markets. The overall decline was driven in part by a sharp drop in exports to Canada following the provinces' removal of American-made spirits from retail shelves. Additionally, exports of American whiskeys to the largest single export market, the European Union, fell by 35% to $454 million.
Despite gains in the rest of the world, American whiskey exports fell below 50% of total U.S. spirits exports — for the first time since 1996 — to a record low of 45%. That statistic deserves to sit on its own for a moment. For thirty years, American whiskey maintained its dominant position within the U.S. export portfolio without interruption. The 2025 collapse is not just a bad year — it is a structural warning about what happens when trade policy and geopolitics converge against a single category.
Canada: The Neighbor That Pulled the Shelf
Exports to Canada plummeted by more than 70% since the start of the country's ban on American spirits in March 2025 due to trade tensions with the U.S. Only two provinces, Alberta and Saskatchewan, have lifted the ban. Canada is not a secondary market for American whiskey — it is a massive consumer base that shares both a border and a deeply intertwined food-and-beverage culture with the United States. Losing that market to political retaliation, and not recovering it, is the kind of wound that takes years to close even after the politics resolve. Brand relationships built over decades can be displaced by local alternatives in a matter of months, and Canadian consumers have shown they are willing to explore domestic and international alternatives when American options disappear from shelves.
Europe: Tariff Roulette on the Biggest Market
The European Union remains the single largest export destination for American spirits, which makes the uncertainty there especially nerve-wracking for distillers. Significant uncertainty persists in the EU, following two successive suspensions of a proposed 30% tariff on all American spirits tied to disputes with the U.S. over EU autos, and steel and aluminum. The 30% tariff was originally scheduled to take effect on August 5, 2025, but was first suspended for six months until February 5, 2026, and subsequently suspended again until August 6, 2026.
In anticipation of retaliatory tariffs, American whiskey exports to the EU increased 64% in the second half of 2024 compared to the same period in 2023. That front-loading strategy bought breathing room for producers but created a statistical hangover: the 35% drop in 2025 EU exports was partly an accounting correction for the surge that preceded it. European distributors and importers had warehouses stocked with American whiskey, reducing the need for fresh orders even as the threat of tariffs temporarily receded.
The date to watch was August 6, when the EU's suspension of retaliatory tariffs on American spirits was set to expire, and no renewal had been announced. If the suspension lapses, American whiskey exports to the EU could fall further from their already-down-35% 2025 level — and the pain would not stay in Europe. Liquid distilled for export does not disappear — it backs up into a domestic market already carrying a record 16.1 million barrels, and discounting pressure in the U.S. off-trade would be expected to intensify as export-intended stock competes for domestic shelf space.
The DISCUS leadership has been unambiguous about what resolution looks like. "The decline of US spirits exports in 2025 underscores the industry's vulnerability to uncertainty in the global trade environment and the vital importance of restoring the permanent return to zero-for-zero tariffs on spirits products," said DISCUS president and CEO Chris Swonger. "When American spirits compete on a level playing field, exports grow, jobs are created and local economies thrive." That sentiment is not wrong, but getting there requires trade negotiations that are driven by far larger economic forces than the spirits sector alone.
The UK Deal: A Reason for Optimism
Not every trade headline in 2026 has been grim for American whiskey. Following a White House visit by King Charles III in April 2026, President Trump announced he was removing tariffs on Scotch whiskey and bourbon between the United States and the United Kingdom. The existing 10% tariff had been in place since 2025. The UK government confirmed the relief applies to all whiskey tariffs, including Irish whiskey from Northern Ireland. For American producers, the UK tariff removal opened a market that punches well above its size — British consumers have a deeply established palate for American whiskey, particularly bourbon, and retail infrastructure there is sophisticated enough to move product at premium price points.
Bilello called it "a big win for the American hospitality businesses." The UK deal also matters as a proof of concept. It demonstrates that under the right diplomatic conditions, the zero-for-zero tariff framework that American spirits advocates have been pushing is achievable. The trick is replicating it in markets where the economic and political calculus is far more complex.
India: The Great Frontier
If there is one market that the entire American whiskey industry talks about with a combination of reverence and frustration, it is India. The numbers behind that focus are staggering. India is already the world's largest whiskey market by volume, with a rapidly expanding consumer class, a sophisticated hospitality culture, and growing demand for premium products. Those three attributes in combination — scale, growth, and premiumization — describe exactly the conditions under which American bourbon and rye could thrive.
The problem has always been the tariff wall. Bilello, speaking during a recent trade trip to Singapore, described the challenge plainly: "There are many markets throughout the world that have a lot of growth potential and big consumer demand for US whiskey, but we are subject to far higher taxation compared to whiskeys from other markets, making us less competitive, and that is an issue." Using India as an example, he noted that American whiskey faces tariffs of 150%.
In February 2025, India cut its bourbon tariff from 150% to 100%. That reduction sounds significant in isolation, and it is — but 100% is still a tariff that doubles the landed cost of a bottle before a single rupee of retail markup or local tax is added. At that level, American whiskey is priced out of the aspirational middle class that represents the real volume opportunity. The premium tier can absorb it, but premium alone does not build a category.
The AWA issued a statement on June 18, 2026, as President Trump pursues a potential landmark U.S.-India trade deal, saying the two countries may be approaching a historic trade moment that could position American whiskey as a leading example of how a strong agreement supports U.S. agriculture, manufacturing, and exports.
Bilello has said, "India represents a defining long-term opportunity for American whiskey," and that "President Trump is on the precipice of brokering what could become a historic US-India trade deal. If American whiskey is included in a meaningful way, this agreement can support American farmers, barrel makers, distillers, exporters, hospitality businesses, and consumers in both countries."
"American whiskey is not asking for preferential treatment," Bilello has said. "We need the ability to compete fairly, reach Indian consumers at a commercially viable price, and let the market decide." That framing is deliberate — it positions American whiskey not as an aggressor seeking to colonize a foreign market, but as a category asking only for the conditions under which quality speaks for itself.
Diplomacy in Action
The AWA has engaged directly with the Trump Administration and U.S. trade officials, provided member input, and submitted letters to the Office of the U.S. Trade Representative. The Association has also met Indian stakeholders, including a closed-door discussion with Ambassador Vinay Kwatra, India's Ambassador to the United States, hosted by the U.S.-India Strategic Partnership Forum in Chicago. That level of diplomatic engagement — closed-door meetings with ambassadors, direct lobbying of trade officials, coordinated advocacy with congressional allies — reflects an organization operating well beyond the traditional role of a spirits trade group.
Congressman Andy Barr, a consistent congressional ally, has framed the India opportunity this way: "Reducing India's tariffs on American whiskey — particularly native spirits from Kentucky, including world-class bourbon and rye — is a meaningful step forward for U.S. distillers, farmers, and the broader supply chain." Bilello, responding to Barr's advocacy, said "progress like this underscores the importance of sustained, bipartisan advocacy to ensure American whiskey can compete on a level global playing field."
Bilello has framed the stakes simply: "American whiskey is America in a bottle. Now the task is to make sure the market access matches the opportunity." It is a line that lands with the weight of the entire Kentucky bourbon industry behind it.
Kentucky's Enormous Stake
No state has more riding on the outcome of these trade talks than Kentucky. The Kentucky Distillers' Association describes Kentucky as the birthplace of bourbon, producing 95% of the world's supply, and the industry is a $9 billion economic and tourism powerhouse generating more than 23,100 jobs with $2.2 billion in salaries and benefits. It attracts more than 2.5 million visitors annually to the Kentucky Bourbon Trail, and the state is home to 15.4 million barrels of whiskey — three times more than the number of residents at 4.5 million.
Those 15.4 million barrels sitting in rickhouses across the state represent a staggering capital commitment. Whiskey, unlike most manufactured goods, cannot be stockpiled indefinitely without consequence — not because it spoils, but because the economics of carrying that much aging inventory while export markets contract creates real financial pressure on producers large and small. The big conglomerates that make up the AWA's founding membership can weather years of compressed margins. The craft distilleries that represent the vast majority of those 2,300-plus operations across the country are far more vulnerable.
The Domestic Plateau and What It Means
American whiskey revenue slipped 0.9% to $5.1 billion in 2025, with volume down 1% to 30 million cases. Those numbers describe an industry that has not collapsed but has clearly exhausted the growth runway it enjoyed through the pandemic years. The consumer boom that drove bourbon prices to stratospheric heights on the secondary market, that turned allocated bottles into currency among collectors, and that prompted massive capacity expansions from distilleries of every size — that era is over.
The U.S. whiskey industry faces significant headwinds. For the first time in more than a decade, consumer demand has declined slightly, and tariffs have roiled the export market. The industry has been buffeted by an avalanche of negative news stories heralding its impending demise, driven by declining demand, shifting consumer tastes among young people and excessive inventories.
Bilello has pushed back on what he sees as an overly pessimistic read of the data. According to industry data, he has noted, the global market for American whiskey is approximately 60–62 million 9-liter cases annually — not 30 million, a figure that alone materially changes the math when assessing the category's overall health. The domestic-only view of American whiskey understates both the category's scale and its opportunity. As Bilello put it directly: "We can no longer rely on the U.S. domestic market to make our goals." That sentence is the entire thesis of the AWA's existence.
Jim Beam's Pause and the Industry Ripple
The announcement by the giant Kentucky bourbon producer Jim Beam that it would "pause operations at its main distillery for an indefinite period beginning in January 2026" sent shock waves through the liquor industry — not only because of Jim Beam's heritage as a brand dating back to 1795, but because it signaled that even the industry's heaviest hitters were not insulated from the slowdown. Even if the world's economy booms, if people are going to be drinking less, the current glut of whiskey will not disappear any time soon, and the thought of producing more in a saturated market hardly seems to make sense.
The Jim Beam pause stands as the most visible symptom of a broader industry recalibration. Production decisions made during the pandemic demand surge — when every distillery with capacity was filling barrels as fast as possible — are now rippling through the supply chain in the form of inventory that exceeds near-term demand. The solution, almost universally agreed upon across the industry, is export growth. Which brings the conversation back, inevitably, to tariffs and trade deals.
The Competition American Whiskey Cannot Ignore
American whiskey has long faced intense competition from many markets including both older compatriots such as Ireland and Scotland, as well as newer distilling markets like Japan and India. That competitive landscape has not simplified — it has grown more crowded. Japanese whisky commands premium shelf space in markets from Singapore to São Paulo. Indian single malts from producers like Amrut and Paul John have earned credibility with serious whisky consumers worldwide. Irish whiskey has been the fastest-growing major whisky category globally for well over a decade.
Meanwhile, Scotch whisky — long the benchmark against which all other whisky is measured — has been fighting its own battles. The Scotch Whisky Association reported a significant 15% decrease in export volumes to the United States between May and December 2025, directly attributed to the reintroduction of a 10% tariff in April 2025. This trade impediment severely impacted the industry's most crucial international market, leading to a 4% reduction in full-year export values. In response to these trade tensions and elevated inventory levels, major spirits groups like Diageo reduced production at several malt distilleries and temporarily halted operations at key sites until at least mid-2026.
The parallel between Scotch and American whiskey is worth sitting with. Both categories are experiencing the consequences of using spirits as a trade war bargaining chip — a role the industry has never sought and cannot escape. Tariffs designed to pressure governments over steel, aluminum, aircraft subsidies, or automotive trade translate directly into price increases on bottles sitting in retail shops that have nothing to do with any of those disputes. The consumer pays more, buys less, or switches brands. Nobody in the distilling business wins.
The Path Forward: What "World's Whiskey" Actually Requires
Making American whiskey the world's whiskey is not a marketing campaign. It is a decade-long project that requires simultaneous progress on multiple fronts: trade negotiations that open or expand market access, consumer education campaigns that build brand equity in markets where bourbon and rye are still unfamiliar, quality standards that protect the category's authenticity as global production expands, and distribution infrastructure that can actually move product in markets where logistics remain challenging.
Under Bilello's leadership, the AWA has committed to three core missions: promoting American whiskey's unique craft and character and its contribution to society, the economy, and the environment; acting as the leading voice representing the American whiskey industry around the world and protecting American whiskey's access to global markets; and maintaining the category's authenticity, provenance, and quality through rigorous standards, definitions, and geographic protections.
That third pillar — standards, definitions, and geographic protections — is one that American whiskey has historically lagged on compared to Scotch, which benefits from the robust legal framework of the Scotch Whisky Regulations and decades of internationally recognized geographic indication protection. American bourbon and rye have federal standards of identity in the United States, but their international legal protections are thinner and harder to enforce. As the category pursues global ambitions, getting those protections formalized in trade agreements becomes as important as the tariff rates themselves.
Tariffs open and close markets, and trade deals may take years to take force. But people sharing a glass tend to outlast the politics of the moment. That observation, in its simplicity, captures something true about the spirits business that the data cannot. American whiskey's rise to global relevance over the past two decades was not engineered by trade policy — it was built by bartenders in Tokyo, Edinburgh, and Sydney who put bourbon in cocktails, by whiskey writers who introduced international audiences to the Kentucky rickhouse, and by a generation of American craft distillers who proved the category could carry complexity and terroir alongside its approachability.
The trade battles of 2025 and 2026 have complicated the story, but they have not changed the underlying quality proposition. Bourbon aged in new American oak, rye with its characteristic spice and assertiveness, Tennessee whiskey with its Lincoln County character — these are distinct, deeply American products with no equivalent elsewhere. That distinctiveness is both the argument for their global success and the insurance policy against the worst trade-war scenarios. No retaliatory tariff can replicate what comes out of a Kentucky or Tennessee rickhouse after years of aging through brutal summers and hard winters. The question is simply whether the politics will eventually get out of the way long enough for the liquid to make that case for itself.
As Bilello puts it: "American whiskey is America in a bottle. Now the task is to make sure the market access matches the opportunity." In 2026, that task is harder than it has been in a generation. But the category has survived worse, and the global appetite for authentic, storied spirits is not going away. The world's whiskey is out there waiting to be claimed — provided American whiskey can navigate the politics long enough to pour the first glass.
