The Liquor Control Board of Ontario (LCBO), one of the world's largest buyers of alcohol, has removed US-made alcoholic drinks from its shelves. This action, which took place on Tuesday, comes in response to the United States imposing a 25% tariff on Canadian goods and remarks by President Donald Trump suggesting Canada could become the 51st state. The decision is seen as a retaliatory measure by the Canadian government and is expected to impact the sales of US-made alcohol significantly in Canada.
The LCBO, renowned for being the exclusive wholesaler in Ontario, sells nearly $1 billion worth of US alcohol annually. However, the removal of these products is not limited to Ontario alone. Other provinces, including Nova Scotia, have taken similar actions against US-made alcoholic beverages. The LCBO's move aligns with broader Canadian governmental responses to the Trump administration's trade policies.
Doug Ford, Premier of Ontario, emphasized the comprehensive nature of the action.
"As of today, every single one of these products is off the shelves."
Canadians are being encouraged by the LCBO to purchase domestically produced alcoholic beverages as part of this strategy. This shift not only serves as a counter to US tariffs but also fosters support for Canadian products amid the ongoing trade tensions.
Despite the significant potential impact on US alcohol sales in Canada, companies like Brown-Forman may not experience substantial financial repercussions. Canada accounts for only a small fraction—approximately 1%—of Brown-Forman's total sales, suggesting minimal overall impact on the company's revenue streams.
Lawson Whiting, a notable figure in the alcohol industry, expressed concern over the Canadian response.
"I mean, that's worse than a tariff, because it's literally taking your sales away, completely removing our products from the shelves."
The LCBO's decision highlights growing tensions between the two nations and underscores the complexities of international trade relations. As one of the largest buyers of alcohol globally, the LCBO's actions could have far-reaching implications for US alcohol producers and distributors.