Vermont's small businesses are grappling with the fallout from tariffs imposed by former President Donald Trump against Canada in February. The tariffs have disrupted trade, particularly affecting enterprises dependent on cross-border relationships with Canada. One notable example involves a shipment of spirits from Barr Hill by Caledonia Spirits, initially ordered by the Société des alcools du Québec (SAQ), which remains undelivered at a shipping dock in Montpelier. The ongoing trade restrictions have also impacted Vermont's tourism industry, leading to reduced operations at Jay Peak Resort and altered hours at the North Troy, VT border crossing. The broader economic implications are raising concerns across various sectors within the state.
Tariffs Disrupt Vermont's Alcohol Trade
Shortly after the announcement of tariffs, the SAQ canceled an order for a shipment from Barr Hill by Caledonia Spirits. This shipment has been sitting idle for about a month, highlighting the immediate impact of the trade barriers on Vermont businesses engaged in the export of alcoholic beverages. The SAQ, responsible for managing alcoholic beverage trade in Quebec, had initiated this order, which now faces indefinite delays.
Ryan Christiansen, president and head distiller at Caledonia Spirits, expressed the financial strain caused by the tariffs.
"We missed our financial plan in February because of this." – Ryan Christiansen, president and head distiller at Caledonia Spirits.
The inability to fulfill such orders not only affects financial projections but also disrupts long-standing business relationships.
Tourism Industry Takes a Hit
The repercussions of the tariffs extend beyond goods to the tourism sector. Jay Peak Resort, a popular destination for Canadian tourists, has witnessed a noticeable decline in visitors. Steve Wright, the resort's president and general manager, emphasized the importance of Canadian guests, particularly during the summer and fall seasons.
"They have an affinity for Jay Peak; they have been coming here for a generation, but there is a point where they will decide to stay home despite their love of the place," – Steve Wright, president and general manager of Jay Peak Resort.
The drop in Canadian tourism has not only affected ticket sales but also merchandise shipments destined for Canadian customers. Consequently, Jay Peak Resort has had to reduce its hours of operation to adapt to the decreased demand.
The North Troy, VT border crossing has similarly adjusted its hours, reflecting the broader decline in cross-border activity.
Broader Economic Concerns
Beyond specific industries, the tariffs have sparked apprehension about rising costs for essential products like animal feed. Businesses like Guy's Farm & Yard in Morrisville face difficult decisions regarding pricing strategies amid increased product costs. Owner Sam Guy expressed the challenge of managing these financial pressures.
"We can't eat this," – Sam Guy, owner of Guy's Farm & Yard in Morrisville.
Despite these challenges, Guy remains committed to maintaining fair pricing for customers.
"We're going to pass on the tariff. We're not going to add a margin or anything like that, but a lot of these are low margin products." – Sam Guy, owner of Guy's Farm & Yard in Morrisville.
Vermont exports approximately $680 million worth of goods to Canada annually, underscoring the significance of maintaining robust trade relations between the two regions. The tariffs have put this economic activity at risk, prompting businesses to explore proactive measures.
Bill Butler, co-owner of Artisans Hand Craft Gallery in Montpelier, highlighted the importance of taking a forward-thinking approach.
"I would rather take the position of being proactive and not just thinking about absorbing the problem," – Bill Butler, co-owner of Artisans Hand Craft Gallery in Montpelier.