US to impose 25% tariff on European wine, cheese, etc.

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John Morris
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US to impose 25% tariff on European wine, cheese, etc.

#1 Post by John Morris » October 2nd, 2019, 2:32 pm

Uh-oh. Time to stock up.

The US government announced this this afternoon. It's 10% on aircraft and 25% on other EU "industrial and agricultural products," including "Irish and Scotch whiskies; wine, olives, cheese; as well as certain pork products [OMG! Prosciutto??], butter and yogurt," to take effect Oct. 15. The World Trade Organization authorized the US to impose tariffs on $7.5 billion worth of EU goods because of subsidies to Airbus.

Bloomberg story
Reuters story
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Re: US to impose 25% tariff on European wine, cheese, etc.

#2 Post by Brian G r a f s t r o m » October 2nd, 2019, 2:34 pm

Lovely. This is really going to put a serious hurtin' on wine retailers throughout the country.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#3 Post by Alan Rath » October 2nd, 2019, 2:37 pm

Burgundy just keeps getting more expensive.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#4 Post by Rick Allen » October 2nd, 2019, 2:40 pm

This may kill my business. We rely on German malt to make our beers, and we haven't found a North American substitute (the German is already more expensive) that is worthy.


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Re: US to impose 25% tariff on European wine, cheese, etc.

#6 Post by GregT » October 2nd, 2019, 2:42 pm

But Airbus has been directly subsidized for many years. I always wondered why the US just ignored that. And China is and has done the same - directly pump state money into enterprises so that they could compete with other countries.

More importantly though, tariffs have never been shown to work well long term - Jefferson found that out, and American Airlines, JetBlue, Frontier, and others are flying Airbus planes. So why tariff cheese instead of those planes?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#7 Post by John Morris » October 2nd, 2019, 2:45 pm

Here's the official list of products.

The tariffs are not across the board, I suppose because the WTO ruling only allows retaliation up to $7.5 billion. They seem targeted to put pressure on particular countries (e.g., lots of German industrial products).

Products that may be of concern to Berserkers:

French, German, Spanish and British (!) wine under 14% (note: not Italian, Portugeuse or Austrian)
Single-malt Irish and Scotch whiskies
Liqueurs and cordials
Spanish olive oil and olives
Cows milk cheese from pretty much anywhere in Europe
Spanish and British sheeps milk cheeses (e.g., Manchego)
"Prepared or preserved pork" from anyplace in the EU (presumably covering prosciutto and speck)
Currant and berry fruit jellies
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Re: US to impose 25% tariff on European wine, cheese, etc.

#8 Post by Brian G r a f s t r o m » October 2nd, 2019, 2:45 pm

Section 7 – Products of France, Germany, Spain or the United Kingdom described below are subject to
additional import duties of 25 percent ad valorem:
2204.21.50 Wine other than Tokay (not carbonated), not over 14% alcohol, in containers not over 2 liters
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Re: US to impose 25% tariff on European wine, cheese, etc.

#9 Post by DanielP » October 2nd, 2019, 2:45 pm

It says wine not over 14%. Will we be seeing alot of 14.1% alcohol wine?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#10 Post by John Morris » October 2nd, 2019, 2:46 pm

Rick Allen wrote:
October 2nd, 2019, 2:40 pm
This may kill my business. We rely on German malt to make our beers, and we haven't found a North American substitute (the German is already more expensive) that is worthy.
I don't see any reference to malt or yeast.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#11 Post by John Morris » October 2nd, 2019, 2:47 pm

DanielP wrote:
October 2nd, 2019, 2:45 pm
It says wine not over 14%. Will we be seeing alot of 14.1% alcohol wine?
A lot of Spanish and Southern French wine could fall outside the tariff for that reason.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#12 Post by KyleC » October 2nd, 2019, 2:48 pm

Josh Grossman wrote:
October 2nd, 2019, 2:40 pm
Full list:
https://ustr.gov/sites/default/files/en ... t_List.pdf
2204.21.50 Wine other than Tokay (not carbonated), not over 14% alcohol, in containers not over 2 liters

Time for the French to start making some California style 14%+ wines champagne.gif
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Re: US to impose 25% tariff on European wine, cheese, etc.

#13 Post by Alan Rath » October 2nd, 2019, 2:50 pm

Josh Grossman wrote:
October 2nd, 2019, 2:40 pm
Full list:
https://ustr.gov/sites/default/files/en ... t_List.pdf
"Wine, not over 14%, not carbonated, not over 2L"

Get ready for an influx of Champagne, CdP, and 3L bottles [wow.gif]
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Re: US to impose 25% tariff on European wine, cheese, etc.

#14 Post by John Morris » October 2nd, 2019, 2:54 pm

GregT wrote:
October 2nd, 2019, 2:42 pm
But Airbus has been directly subsidized for many years. I always wondered why the US just ignored that. And China is and has done the same - directly pump state money into enterprises so that they could compete with other countries.

More importantly though, tariffs have never been shown to work well long term - Jefferson found that out, and American Airlines, JetBlue, Frontier, and others are flying Airbus planes. So why tariff cheese instead of those planes?
The EU has argued for years (I think for two decades or so) that Boeing benefits from subsidies because its defense aircraft contracts help underwrite development of civilian aircraft. So it wasn't as simple as "they subsidize, we don't." And I believe that the EU governments have curtailed their subsidies to Airbus over the last 15 years or so, as the company grew bigger and more solid. Since Airbus was formed with government support so a European company could compete with the likes of Boeing and Lockheed, it was hard for the British, French, German and Spanish governments not to keep supporting it.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#15 Post by Howard Cooper » October 2nd, 2019, 3:02 pm

DanielP wrote:
October 2nd, 2019, 2:45 pm
It says wine not over 14%. Will we be seeing alot of 14.1% alcohol wine?
More business for Rolland.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#16 Post by K John Joseph » October 2nd, 2019, 3:07 pm

John Morris wrote:
October 2nd, 2019, 2:32 pm
Uh-oh. Time to stock up.

The US government announced this this afternoon. It's 10% on aircraft and 25% on other EU "industrial and agricultural products," including "Irish and Scotch whiskies; wine, olives, cheese; as well as certain pork products [OMG! Prosciutto??], butter and yogurt," to take effect Oct. 15. The World Trade Organization authorized the US to impose tariffs on $7.5 billion worth of EU goods because of subsidies to Airbus.

Bloomberg story
Reuters story
Obviously in direct response to the Bloomberg article published today about how Kerrygold Irish Butter is now No. 2 in butter sales and whipping every US entity in growth among US consumers.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#17 Post by Patrick Duffy » October 2nd, 2019, 3:11 pm

John Morris wrote:
October 2nd, 2019, 2:54 pm
GregT wrote:
October 2nd, 2019, 2:42 pm
But Airbus has been directly subsidized for many years. I always wondered why the US just ignored that. And China is and has done the same - directly pump state money into enterprises so that they could compete with other countries.

More importantly though, tariffs have never been shown to work well long term - Jefferson found that out, and American Airlines, JetBlue, Frontier, and others are flying Airbus planes. So why tariff cheese instead of those planes?
The EU has argued for years (I think for two decades or so) that Boeing benefits from subsidies because its defense aircraft contracts help underwrite development of civilian aircraft. So it wasn't as simple as "they subsidize, we don't." And I believe that the EU governments have curtailed their subsidies to Airbus over the last 15 years or so, as the company grew bigger and more solid. Since Airbus was formed with government support so a European company could compete with the likes of Boeing and Lockheed, it was hard for the British, French, German and Spanish governments not to keep supporting it.
Lockheed does not make civilian aircraft. Airbus has been struggling in recent years because it is a multi-government entity. Every decision is political, from where the top officers come from to where things will be built and who will be the second and third level contractors. Whether the decision makes sense financially or whether the proposed C-level exec is really the best candidate is very secondary to the decision. I, for one, hate to fly Airbus planes because the overhead space is so limited, compared to Boeing planes.

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Re: US to impose 25% tariff on European wine, cheese, etc.

#18 Post by julianseersmartin » October 2nd, 2019, 3:43 pm

Anyone know what the exclusion of Tokaji is about?

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Re: US to impose 25% tariff on European wine, cheese, etc.

#19 Post by Alan Rath » October 2nd, 2019, 3:49 pm

Does anyone know how the tariffs kick in? Like wines already contracted/purchased but not shipped?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#20 Post by D@vid Bu3ker » October 2nd, 2019, 3:49 pm

julianseersmartin wrote:
October 2nd, 2019, 3:43 pm
Anyone know what the exclusion of Tokaji is about?
Tokaji is under a different tariff code. The codes are not exactly structured.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#21 Post by D@vid Bu3ker » October 2nd, 2019, 3:50 pm

Alan Rath wrote:
October 2nd, 2019, 3:49 pm
Does anyone know how the tariffs kick in? Like wines already contracted/purchased but not shipped?
If the wines have not been accepted through US Customs prior to the date then the tariffs kick in.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#22 Post by John Morris » October 2nd, 2019, 3:51 pm

Patrick Duffy wrote:
October 2nd, 2019, 3:11 pm
Lockheed does not make civilian aircraft. Airbus has been struggling in recent years because it is a multi-government entity. Every decision is political, from where the top officers come from to where things will be built and who will be the second and third level contractors. Whether the decision makes sense financially or whether the proposed C-level exec is really the best candidate is very secondary to the decision. I, for one, hate to fly Airbus planes because the overhead space is so limited, compared to Boeing planes.
Lockheed was very much in their sights in the beginning, because one of the original aims in forming Airbus was to create a pan-European defense aerospace company so European governments didn't have to buy their military aircraft from Boeing or Lockheed.

Airbus is not "a multi-governmental entity." It's been publicly traded for a long time. But, you're right that governments have meddled and supported it more than the US government has its American competitors, and there's haggling with governments about where to locate plants within the EU. (The US government does provide a LOT of export financing for sales of Boeing planes abroad through the Export-Import Bank, however. As I recall, most of the Ex-Im Bank's credit went to Boeing purchases.)

Isn't the configuration of overhead storage a choice by the airlines in how they have the planes outfitted, like seats?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#23 Post by Ethan Abraham » October 2nd, 2019, 3:54 pm

D@vid Bu3ker wrote:
October 2nd, 2019, 3:50 pm
Alan Rath wrote:
October 2nd, 2019, 3:49 pm
Does anyone know how the tariffs kick in? Like wines already contracted/purchased but not shipped?
If the wines have not been accepted through US Customs prior to the date then the tariffs kick in.
So what happens to retailers that have sold millions of dollars of bordeaux futures...

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Re: US to impose 25% tariff on European wine, cheese, etc.

#24 Post by D@vid Bu3ker » October 2nd, 2019, 3:57 pm

If the wines have not yet cleared customs then someone is going to pay 25% on the value of the imports.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#25 Post by Pat Martin » October 2nd, 2019, 4:14 pm

D@vid Bu3ker wrote:
October 2nd, 2019, 3:57 pm
If the wines have not yet cleared customs then someone is going to pay 25% on the value of the imports.
I see some wrangling over canceling orders in our near future.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#26 Post by D@vid Bu3ker » October 2nd, 2019, 4:14 pm

Or merchants eating costs...ugly no matter what.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#27 Post by Dennis Atick » October 2nd, 2019, 4:25 pm

Jeez, how did we ever end up in this situation?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#28 Post by Richard T r i m p i » October 2nd, 2019, 4:32 pm

John Morris wrote:
October 2nd, 2019, 2:45 pm
Here's the official list of products.

The tariffs are not across the board, I suppose because the WTO ruling only allows retaliation up to $7.5 billion. They seem targeted to put pressure on particular countries (e.g., lots of German industrial products).

Products that may be of concern to Berserkers:
French, German, Spanish and British (!) wine under 14% (note: not Italian, Portugeuse or Austrian)
Cows milk cheese from pretty much anywhere in Europe
"Prepared or preserved pork" from anyplace in the EU (presumably covering prosciutto and speck)
Italians make up nearly half of our "daily drinkers". Looks like that will continue or increase. There's no way to completely replace French wines.

The cows milk cheese tariff will SUCK. My wife and I eat some sort of European cheese at least 5 days/week. Lots of Parmesan.

We don't eat a lot of "preserved pork"...but I do love the little that we do.

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Re: US to impose 25% tariff on European wine, cheese, etc.

#29 Post by Frank Murray III » October 2nd, 2019, 4:44 pm

Richard, cool avatar. Inspired me to change mine, thank you.

Dennis, the broader situation for politics and culture is not improving, and it's only getting worse. No winners to be had in any of this insanity, we're all gonna lose, regardless of the side we find ourselves on.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#30 Post by Markus S » October 2nd, 2019, 4:45 pm

John Morris wrote:
October 2nd, 2019, 2:54 pm
GregT wrote:
October 2nd, 2019, 2:42 pm
But Airbus has been directly subsidized for many years. I always wondered why the US just ignored that. And China is and has done the same - directly pump state money into enterprises so that they could compete with other countries.

More importantly though, tariffs have never been shown to work well long term - Jefferson found that out, and American Airlines, JetBlue, Frontier, and others are flying Airbus planes. So why tariff cheese instead of those planes?
The EU has argued for years (I think for two decades or so) that Boeing benefits from subsidies because its defense aircraft contracts help underwrite development of civilian aircraft. So it wasn't as simple as "they subsidize, we don't." And I believe that the EU governments have curtailed their subsidies to Airbus over the last 15 years or so, as the company grew bigger and more solid. Since Airbus was formed with government support so a European company could compete with the likes of Boeing and Lockheed, it was hard for the British, French, German and Spanish governments not to keep supporting it.
The ruling that came out also said the US is subsidizing Boeing as well, but that case won't be decided on until next year. So first is this one against the EU for Airbus, and next year the Europeans can do tit-for-tat when the WTO decides in it's favor. But why negotiate when there is an election next year and you can stick it to the foreigners NOW?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#31 Post by Rick Allen » October 2nd, 2019, 4:47 pm

John Morris wrote:
October 2nd, 2019, 2:46 pm
Rick Allen wrote:
October 2nd, 2019, 2:40 pm
This may kill my business. We rely on German malt to make our beers, and we haven't found a North American substitute (the German is already more expensive) that is worthy.
I don't see any reference to malt or yeast.
When I saw the headline I thought it was on all agricultural products. I guess I'm safe - for now.

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Re: US to impose 25% tariff on European wine, cheese, etc.

#32 Post by Markus S » October 2nd, 2019, 4:48 pm

Frank Murray III wrote:
October 2nd, 2019, 4:44 pm
Richard, cool avatar. Inspired me to change mine, thank you.
This is a nice avatar, super friendly. I don't think I understood your last one, was it an album or something?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#33 Post by D@vid Bu3ker » October 2nd, 2019, 4:50 pm

Markus-please avoid the political realm. Let’s stick to the effects.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#34 Post by Markus S » October 2nd, 2019, 4:52 pm

julianseersmartin wrote:
October 2nd, 2019, 3:43 pm
Anyone know what the exclusion of Tokaji is about?
Just a guess, but their hard-right government is a thorn in the EU's side, and our beloved leader wants to push it in a little further since it is 'friendly' to him and vice-versa.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#35 Post by Markus S » October 2nd, 2019, 4:53 pm

D@vid Bu3ker wrote:
October 2nd, 2019, 4:50 pm
Markus-please avoid the political realm. Let’s stick to the effects.
What politics? I didn't mention anything that was not decided today by the WTO. You can look it up if you want to, but you would rather accuse me instead.
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#36 Post by D@vid Bu3ker » October 2nd, 2019, 4:57 pm

Your last sentence in post #30 was clearly political.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#37 Post by Frank Murray III » October 2nd, 2019, 4:59 pm

Markus S wrote:
October 2nd, 2019, 4:48 pm
Frank Murray III wrote:
October 2nd, 2019, 4:44 pm
Richard, cool avatar. Inspired me to change mine, thank you.
This is a nice avatar, super friendly. I don't think I understood your last one, was it an album or something?
Is the question, Markus, to me or Richard?
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2017 Rivers-Marie PN Platt SC
2017 Kutch Pinot Noir SC PN
2009 Roederer Cristal Brut
2017 Carlisle Zin Mancini Ranch RRV

My best wines of 2018:
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2012 Marguet La Grande Ruelle Ambonnay

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Re: US to impose 25% tariff on European wine, cheese, etc.

#38 Post by David_K » October 2nd, 2019, 5:33 pm

So what is the practical increase on the end-cost to consumers? If a bottle is $50 on the shelf now, and holding all other variables equal (exchange rate, markup, etc.), the next vintage is subject to the tariff, what will next year's shelf price be?
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Re: US to impose 25% tariff on European wine, cheese, etc.

#39 Post by John Morris » October 2nd, 2019, 5:46 pm

On your assumptions, the price would rise 25% to $62.50.

But basic economics will tell you that the sellers (producers, importers, distributors, retailers) will eat (as it were) part of the increase, because the increase in price will reduce demand and they'll be better off to retain sales by absorbing some of the loss. It is almost never the case that an increase in costs or taxes is passed through 100%.

The good news is that the euro is down to $1.10 (from a high in the $1.40s in 2011) (oh, that nasty Federal Reserve driving up the dollar!), which mitigates this somewhat.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#40 Post by DanielP » October 2nd, 2019, 5:53 pm

John Morris wrote:
October 2nd, 2019, 2:47 pm
DanielP wrote:
October 2nd, 2019, 2:45 pm
It says wine not over 14%. Will we be seeing alot of 14.1% alcohol wine?
A lot of Spanish and Southern French wine could fall outside the tariff for that reason.
Rather, will we be seeing much more wine being labeled as such? My understanding is that there's some leeway in ABV labeling of wine
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Re: US to impose 25% tariff on European wine, cheese, etc.

#41 Post by Marcu$ Stanley » October 2nd, 2019, 5:57 pm

Damn, what a bizarre incentive structure. Big subsidy to overextracted left bank Bordeaux and Burgundy. Does anyone have Trump Administration connections that can change it to a 25% tariff on wines *over* 14%? Much better public policy justification!

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Re: US to impose 25% tariff on European wine, cheese, etc.

#42 Post by D@vid Bu3ker » October 2nd, 2019, 6:10 pm

Just remember that over 14% wine already has a higher tax structure, so labeling wines as over 14% does not mitigate the whole cost of the tariffs.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#43 Post by Kevin Gibbs » October 2nd, 2019, 6:17 pm

John Morris wrote:
October 2nd, 2019, 5:46 pm
On your assumptions, the price would rise 25% to $62.50.

But basic economics will tell you that the sellers (producers, importers, distributors, retailers) will eat (as it were) part of the increase, because the increase in price will reduce demand and they'll be better off to retain sales by absorbing some of the loss. It is almost never the case that an increase in costs or taxes is passed through 100%.

The good news is that the euro is down to $1.10 (from a high in the $1.40s in 2011) (oh, that nasty Federal Reserve driving up the dollar!), which mitigates this somewhat.
That isn’t correct. The tariffs are calculated as 25% of the import cost, not the retail sales price.

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Re: US to impose 25% tariff on European wine, cheese, etc.

#44 Post by Yao C » October 2nd, 2019, 6:22 pm

Kevin Gibbs wrote:
October 2nd, 2019, 6:17 pm
John Morris wrote:
October 2nd, 2019, 5:46 pm
On your assumptions, the price would rise 25% to $62.50.

But basic economics will tell you that the sellers (producers, importers, distributors, retailers) will eat (as it were) part of the increase, because the increase in price will reduce demand and they'll be better off to retain sales by absorbing some of the loss. It is almost never the case that an increase in costs or taxes is passed through 100%.

The good news is that the euro is down to $1.10 (from a high in the $1.40s in 2011) (oh, that nasty Federal Reserve driving up the dollar!), which mitigates this somewhat.
That isn’t correct. The tariffs are calculated as 25% of the import cost, not the retail sales price.
You're both right. Yes it's true that tariffs affect wholesale cost, not retail sales price. But in addition, to John's point, there is almost certainly some demand elasticity, which means that a rational supply chain will not pass on 100% of the cost increase
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Re: US to impose 25% tariff on European wine, cheese, etc.

#45 Post by Robert M yers » October 2nd, 2019, 6:28 pm

Deleted for bad math...
Last edited by Robert M yers on October 2nd, 2019, 8:22 pm, edited 2 times in total.

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Re: US to impose 25% tariff on European wine, cheese, etc.

#46 Post by J. Rock » October 2nd, 2019, 6:32 pm

David_K wrote:
October 2nd, 2019, 5:33 pm
So what is the practical increase on the end-cost to consumers? If a bottle is $50 on the shelf now, and holding all other variables equal (exchange rate, markup, etc.), the next vintage is subject to the tariff, what will next year's shelf price be?
I think the consumer and suppliers will share the burden of the increased cost; however, who takes on what share of such cost will depend on demand elasticity. I imagine the suppliers will bear more of the increased cost in connection cheaper, value wines (or potentially stop selling some of them, depending on their margin), while the consumers will probably bear more of the increased cost in connection to more premium wines.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#47 Post by Rauno E (NZ) » October 2nd, 2019, 6:38 pm

Hopefully this lowers demand from the USA for a bunch of wines I want, making it easier for me ;)! I sympathise with you guys in the US though, at least those of you who didn't bring this on yourselves.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#48 Post by Tom G l a s g o w » October 2nd, 2019, 7:00 pm

John Morris wrote:
October 2nd, 2019, 2:54 pm
GregT wrote:
October 2nd, 2019, 2:42 pm
But Airbus has been directly subsidized for many years. I always wondered why the US just ignored that. And China is and has done the same - directly pump state money into enterprises so that they could compete with other countries.

More importantly though, tariffs have never been shown to work well long term - Jefferson found that out, and American Airlines, JetBlue, Frontier, and others are flying Airbus planes. So why tariff cheese instead of those planes?
The EU has argued for years (I think for two decades or so) that Boeing benefits from subsidies because its defense aircraft contracts help underwrite development of civilian aircraft. So it wasn't as simple as "they subsidize, we don't." And I believe that the EU governments have curtailed their subsidies to Airbus over the last 15 years or so, as the company grew bigger and more solid. Since Airbus was formed with government support so a European company could compete with the likes of Boeing and Lockheed, it was hard for the British, French, German and Spanish governments not to keep supporting it.
Apparently, the ruling on Airbus came first and the Boeing ruling will be later. The US and EU couldn’t come to an agreement on subsidies to aerospace. No surprise in this environment.

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Re: US to impose 25% tariff on European wine, cheese, etc.

#49 Post by Robert.A.Jr. » October 2nd, 2019, 7:03 pm

Howard Cooper wrote:
October 2nd, 2019, 3:02 pm
DanielP wrote:
October 2nd, 2019, 2:45 pm
It says wine not over 14%. Will we be seeing alot of 14.1% alcohol wine?
More business for Rolland.
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Re: US to impose 25% tariff on European wine, cheese, etc.

#50 Post by D@vid Bu3ker » October 2nd, 2019, 7:04 pm

Kevin Gibbs wrote:
October 2nd, 2019, 6:17 pm
John Morris wrote:
October 2nd, 2019, 5:46 pm
On your assumptions, the price would rise 25% to $62.50.

But basic economics will tell you that the sellers (producers, importers, distributors, retailers) will eat (as it were) part of the increase, because the increase in price will reduce demand and they'll be better off to retain sales by absorbing some of the loss. It is almost never the case that an increase in costs or taxes is passed through 100%.

The good news is that the euro is down to $1.10 (from a high in the $1.40s in 2011) (oh, that nasty Federal Reserve driving up the dollar!), which mitigates this somewhat.
That isn’t correct. The tariffs are calculated as 25% of the import cost, not the retail sales price.
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