American distillers have been recipients of a costly cold shoulder from Canada, where their exports plunged 85 percent earlier this year, topping broad declines in key international markets amid global trade tensions, a spirits industry group said.

The majority of Canadian provinces continue to ban American spirits from shelves, though Canada removed its retaliatory tariff on the products weeks ago, said the Distilled Spirits Council of the United States. There’s another concern: that consumer reaction to the trade conflicts could curb the international thirst for American spirits in key markets.

Overall exports of American spirits fell 9 percent in the second quarter of 2025 compared to a year ago, the council said in its new report. Sharp declines occurred in other crucial markets, it said, including the European Union, United Kingdom and Japan. That comes on the heels of a banner year for American spirits exports in 2024, DISCUS said. Total first-quarter exports in 2025 edged up by 1 percent from a year ago.

“There’s a growing concern that our international consumers are increasingly opting for domestically produced spirits or imports from countries other than the U.S., signaling a shift away from our great American spirits brands,” Chris Swonger, DISCUS president and CEO, said in a release.

Canada remains the only trading partner that retaliated against American spirits in the latest rounds of trade conflicts spurred by President Donald Trump’s tariff policies. The president maintains that open trade cost the United States millions of factory jobs and that tariffs are the path to American-made prosperity.

DISCUS is pressing for free-flowing trade for distilled spirits with zero-for-zero tariffs with key markets, saying it would give American distillers the certainty they need.

Global markets are increasingly vital for producers of American whiskey, which includes bourbon, Tennessee whiskey and rye whiskey. The sector faces a supply-and-demand crunch in the United States, where a sales slowdown is coinciding with massive stockpiles of whiskey, the council said.

“With the slowdown in the U.S. market, it’s more important than ever for American distillers to have reliable access to international markets,” Swonger said. “Until these trade issues are fully resolved, many distillers are remaining on the sidelines, fearful that without a permanent return to zero-for-zero tariffs, they could once again face retaliatory tariffs. They simply don’t want to risk jeopardizing the investments they’d need to make to reestablish their presence abroad.”

The most dramatic quarterly drop off in exports occurred in Canada, where American spirits exports fell below $10 million amid the 85 percent plunge in the April-through-June quarter, the report showed.

Elsewhere, exports of American spirits to the European Union — the U.S. industry’s largest export market — fell 12 percent in the second quarter, the council said. Exports to the United Kingdom dropped 29 percent and exports to Japan decreased 23 percent, it said.

The pain was felt across a range of spirits categories, with quarterly declines of 13 percent for American whiskey, 14 percent for vodka, 15 percent for cordials and 12 percent for brandy, it said.

The declines were softened somewhat by surging sales to other countries, including Mexico, Australia, Brazil, Singapore and South Korea, the council said.

Distilled spirits were exported from 43 states last year, with Tennessee and Kentucky ranking first and second, respectively, the report said. Texas was third, followed by Florida and Indiana.