Michael Bilello Talks US-Canada Booze Ban

**SPEAKER_1** (0:02)
Bloomberg Audio Studios, Podcasts, Radio, News.

**Christina Ruffini** (0:07)
All right, we're speaking this morning about the somewhat surprised collapse of the U.S.-Canada trade talks. This tit-for-tat tariff debate have hit a lot of American producers hard, including American liquor companies and distillers, who usually sell quite a bit of product across the northern border.

**David Gura** (0:22)
Helping us distill all of this, I'm groaning at my own comment. We have Michael Bilello, President and CEO of the American Whiskey Association. Michael, great to have you with us here.
I want to just ask you about the state of play. We don't have to get into the granular details here because we don't really know a whole lot about what happened with the talks. But when you look at the business that you represent, what has the last year plus meant for them not having access as they had before to the Canadian market?

**SPEAKER_1** (0:47)
Yeah.

**Michael Bilello** (0:47)
Good morning. Thanks for having me. Obviously, we didn't get the breakthrough we were all hoping for this morning. So for American Whiskey producers, this remains unfinished business. As you pointed out, for a year and a half now, American Whiskey has all been basically shut out from most of the provinces in Canada. And this is something that affects the entire American Whiskey supply chain. So not just the distillers, but all the way down to the Coopers and also the grain farmers. So obviously, we were hoping for a breakthrough. We were hoping for a deal. We were hoping to regain access to the Canadian market. Then we were hoping that the provinces would align with the federal government and allow us to have access to the shelves.
We were really looking forward to reconnecting with our Canadian consumer. But obviously, that's not happening.

**Christina Ruffini** (1:30)
How big of a part of the business is this that you're losing, either in a percentage or a dollar amount? How big of a hunk of what you would usually sell is not there at the moment?

**Michael Bilello** (1:42)
Well, I'll point to the White House figures that were shared. So in 2024, when the provincial restrictions went in effect, you had a market that was about $203 million when you measured that from March of 2024 when it went to effect to December. When you look at the same year-over-year comparison, it was down to $60 million, so roughly a 70 percent decrease in US Spirit exports to Canada.
By the way, American Whiskey is about over a billion dollar export for the US economy. So at the same time, by the way, American Whiskey and US Spirit exports grew by about 2.5 percent everywhere else except Canada. So to put things in perspective, this prohibiting American Whiskey on those shelves really did have an impact on the category, but also US Spirits in general.

**David Gura** (2:31)
Michael, let me just ask you about the quality of conversation you've been having with American leadership, Canadian leadership all through this.
I imagine many groups affected by these tariffs been trying to bend the ear of the White House and the US Trade Representative, likely trying to do the same thing with the Canadian counterparts. How engaged have you been in the process? What have those conversations been like?

**Michael Bilello** (2:52)
Well, I can say what's really special about the spirits industry is globally, we are very connected. We see this as one ecosystem. So we are all about fair market access, competition. We want the world's whiskeys to compete, but we really do focus on market access and fair competition. So as an industry, we've always been very united and aligned on what we're looking for globally in terms of trade policy.
When we look at the Trump administration and our counterparts in Canada, we're obviously equally engaged on both sides, and we were always taking part in constructive conversations and making sure parties were aligned and the impact was known and understood on both sides. Because remember something, the United States and Canada, we are part of the same North American hospitality ecosystem. So this didn't just have an impact on the US side, it also impacted the Canadian side of things. So again, the industry, always connected, always sharing information. We were always focused on market access.
And then for both the US government and the Canadian government, they've always been engaged and really looking at the trade officials and the people who are really doing the hard work behind the scenes. Those lines were open, communication was flowing. We received good indications yesterday, there was progress being made. So obviously to learn about this late last night or early this morning was really unfortunate.