China-U.S. trade dispute threatens U.S. wine industry

Wine merchant Yunxiang Dong of China, right, tastes a Californian red wine at the international wine fair "Vinexpo" in Bordeaux, southwestern France, Tuesday, June 19, 2007. [Photo: AP/Bob Edme]

California's growing wine industry fears its customer base across the Pacific may shrink, as they are concerned about the prospect of retaliatory tariffs imposed by China.

CRI's Yu Yang has the story.

U.S. President Donald Trump signed a memorandum that could impose tariffs on up to 60 billion U.S. dollars of imports from China and put restrictions on Chinese investment in the US, and China is now mulling retaliatory tariffs on the United States' agriculture sector.

On hearing news that China could slap tariffs on California wines, some people have expressed concerns about a possible trade war with this country's biggest trading partner.

Ryan Bjorkquist, a wine enthusiast at tasting rooms in California's Napa Valley, says the possible trade war is no good for anyone.

"China's a big emerging market for California wine, and everything is related - whether it's steel products or aluminum, whatever. Everything does have a cause and effect. So, whether it's electronics or wine, an emerging trade war, I don't think is good for anybody."

Angela Dilaura, another wine enthusiast, has also offered her insight into the current situation.

"The Chinese market - they can buy wine from Europe, they can buy the wine from South America, they can buy wine from the United States. There are a lot of options, and in this type of global economy it's important that the United States remains competitive."

Napa Valley has 225-thousand acres of land and is responsible for just four percent of the total volume of California Wine. But it produces about a third of the total value.

Michael Honig, president of Honig Wine, a third generation family vineyard, says every time the price goes up, there are fewer people who are able to afford those products as they're at the top of the luxury pyramid.

"So, if I sell something for a dollar. By the time it reaches the port in China, it's marked up 50 cents, so it's 1.50 dollars. The new price would go to 1.65 dollars. A great example is Australia, which next year 2019, their tariffs and duties go down to zero. So we are trying to compete not only with other California producers, but wineries from around the world."

Honig was one of the first to enter the Chinese market more than a decade ago.

Since then, Honig and his team have increased exports to China tenfold.

Napa Valley growers want a bigger share of China's growing wine market, and don't want U.S. tariffs to get in the way.