(LEX 18) — Those in the bourbon industry believe they should be currently toasting to their success.
"We've got this time in our industry where we're at the height of our success," said Eric Gregory, the president of the Kentucky Distillers' Association. "We've got more bourbon aging in Kentucky than ever before. Production is up 600% in the last 25 years. We have distillers in 40 counties. The Kentucky Bourbon Trail is bringing millions of people over here from all over the world."
However, that success is overshadowed by concerns over looming retaliatory tariffs.
Gregory explains that American Whiskey has become a pawn in a trade war.
"We literally woke up one morning in 2018 and I got a call from a foreign journalist who said 'how do you like being pawns in a trade war?'" said Gregory.
In 2018, then-President Donald Trump set a tariff on steel and aluminum. The European Union hit the United States back with a 25% tariff on American whiskey. In March 2025, that tariff is set to return - doubled.
"It's set to come back in March and it's set to come back at 50%," said Gregory. "It cost hundreds of millions of dollars at 25%. I really cringe to think what a 50% tariff would do to Kentucky bourbon."
Gregory believes the tariff will disrupt growth, cost American jobs, jeopardize investment, and hurt local economies across the Commonwealth.
Retaliatory tariffs from the E.U. and other countries have cost Kentucky Bourbon a half-billion dollars in exports since 2018, according to the KDA.
"Over 23,000 people in Kentucky rely on the bourbon industry for their livelihood and that is more than double than what it was just 10 years ago," said Gregory. "That's everything from hard-working farm families to truckers, hospitality staff, coopers - you name it - all over Kentucky. If that tariff comes back at 50%, I'm afraid all those people will feel the pain."
Gregory worries that the smaller craft distillers will particularly be in trouble. However, he maintains some optimism that the industry that made it through prohibition will survive.
