Allegrini 2018

The USA, in case of duties, don’t panic: at WineNews, Tara Empson, Empson & Co importer’s guide

“The impact would be heavy, but for now there is only a great confusion of information. If they arrive, it will be crucial to be consistent”
Tara Empson, Empson & Co importer’s guide, one of the pioneers of Italian wine in the USA

The USA is certainly a fundamental market for Italian wine. It is much more difficult to understand what is going to happen in that market, or rather in those markets, as many as the States of the Union, with a very attentive eye to the duty issue, but also to changes in consumption styles, to competition from other producer countries and not only. WineNews spoke with Tara Empson, head of Empson & Co., historic importer of Italian wines in the USA (born in 1972 in Milan, founded by Neil Empson), which today has among its partners brands such as Boscarelli, Bucci, Conterno Fantino, Conti Costanti, Costaripa, Enrico Gatti, Farnese, Felsina, Franz Hass, Fuligni, Pietradolce, Poderi Einaudi, Cantina di Santadi, Speri and Suavia, to name a few. First of all, net of what it will happen, it is important to understand how Italian wine is today in the U.S. market. “The answer, as always, is not univocal. Wine is always fine - answers Tara Empson, who is 34 years old and took over the reins of the company from her father Neil - but it is also affected by a wider market choice that, today, offers different product ranges. I notice that in general the per capita consumption of wine has decreased. Before, spirits and wine, French or Italian, were practically the only choice and they had the supremacy, while now there are products such as low-alcohol seltzers, craft beers and canned wine. And soft drinks also proliferate on the market, such as alcohol-free gin, for example. The millennial consumer lives in an environment where he doesn’t want to get drunk, he wants to socialize without losing control, and can even spend (these soft drinks are not cheap). However, it should also be noted that not all people who choose to drink these drinks are also wine consumers. I don’t notice any differences in the Italian wine that is most appreciated here in the USA. There is a lot of interest in exploring Italy in its totality and diversity. Italy always has a great charm. In general, I can say that the wines of Etna are doing very well and that Sardinia is beginning to take hold, as are the wines of the Aeolian Islands, although in the latter case they are niche products and much higher price ranges. Again, Sangiovese is coming back a lot and the presence of Campania is growing, thanks to producers who have a new mindset and are more ready for a market that is asking for more and more investments. According to our data, the most requested price range of the product (on the shelf) is between 15 and 19.99 dollars per bottle. The range immediately below is losing market share”.
Turning to the news, the threat of new duties is frightening the industry. Above all, thinking about what would happen, in concrete terms, if 100% tariffs were introduced on wines from Europe in general, and Italy in particular. “I don’t think that the 100% duty rate can be a lasting condition. It would be a real catastrophe - explains Tara - starting with the producers, and then having a repercussion here, in America, not only for importers and distributors but also for the entire hospitality sector. The impact on the entire “wine industry”, on all the jobs that gravitate around the “Made in Italy” wine and food industry would be devastating. I hope that such a high percentage in taxation could continue, if introduced, for a couple of months at the most, and then be removed. On the other hand, the duties of a lower percentage, for example 25%, would certainly be prolonged but with a certainly smaller impact on all of us operators. The duties would put everyone in crisis, the whole supply chain is at risk. A good part of Italian wineries sells 25% to 50% of their product to the USA. It will save those who, over time, have managed to create an export network, those who, mindful of the black year of the American economy, have learned that you can not rely on the economy of a single country but it is important to have a pool of countries-customers for their product.
As already reported by WineNews, many importers have anticipated the orders, and many producers have consequently shipped them, especially from important territories such as Langhe and Montalcino. According to some, in fact, this is the only possible countermeasure at the moment. “There have been different choices. Some have decided to wait - explains Empson - and others have not. Some have panicked and now have a huge stock of wine here on American soil, others are waiting to understand. It’s definitely a gamble. Our policy has been to wait, also because depending on whether duties come into force or not, we will have to review the sales price list”.
Certainly, it is that one would think that, in case of duties on EU wines, other producing countries, starting from the USA itself, could benefit from them. “Absolutely true. Countries like New Zealand, Chile or Australia, which has always exported high quality Pinot Noir, for example, would benefit from this. These countries are producing good volumes of wine and, often, at competitive prices (sometimes at lower costs than Italian wines). And American wines would also benefit. To conclude, I would like to say that, at this moment, the predominant feeling is fear, as well as great confusion: so much different information and so much uncertainty. The most dangerous thing now is to panic. And, for once, it is fundamental for Italians to act with coherence of intent, to keep open communication with their partners, here on the market, namely us importers, and not to give in to panic if the duties become reality”.

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