New tariffs in the United States are tightening the squeeze on New Zealand’s $750 million wine export trade. US President Donald Trump confirmed the rate would rise from 10% to 15% last week.
The industry’s peak body says the change equates to about $112 million in additional charges. Wine producers now face a price disadvantage compared with exporters from countries with lower duties.
$112 Million Tariff Increase Puts NZ Wine Producers Under Pressure
Sarah Wilson, advocacy general manager for New Zealand Winegrowers, called the move “very concerning,” warning it would have a “significant impact” on producers.
“Your typical bottle of New Zealand wine six months ago, that tariff was about 10 cents and now we’re looking at more like $1.10,” she told Herald NOW. “That’s $112m in extra tariffs that’s got to come from somewhere.”
Competitive Disadvantage Against Lower-Tariff Exporting Nations
While tariffs affect all exporters to the US, Wilson said New Zealand is now at a greater disadvantage compared to key competitors. Australia, Chile, and Argentina all face a lower 10% tariff.
“What we’ve seen with these [tariff] announcements is that a lot of those countries are at different tariff rates from us… it’s that differentiation that’s a real concern,” she said.
Wilson stressed New Zealand’s wine reputation remains a strength despite the setback.
“We’re still well placed because we have a strong reputation for the wine that we produce in New Zealand. We’re known for producing distinctive wines, sustainable wines – that hasn’t changed, but certainly from a tariff perspective it puts us at a disadvantage.”
Uncertainty Over US Export Volumes
It is not clear if the hike will reduce the volume of wine shipped to the US. However, Wilson said industry leaders will “certainly be keeping a watch out for that,” adding that the hope is New Zealand’s established quality will keep sales steady despite higher prices.
Trade Policy Concerns and Wider Market Impact
According to Stats NZ, the US is New Zealand’s second-largest export destination overall, accounting for $9 billion in total goods exports last year.
Trade expert Stephen Jacobi described the original 10% tariff as “unjustified” and said the latest increase is “even more unjustified.” He noted that New Zealand “impose[s] very few tariffs on the United States,” highlighting what exporters see as an imbalance in trade policy.
Felicity Roxburgh, executive director of the New Zealand International Business Forum, warned the higher tariffs will “cause real pain for New Zealand exporters.”
“Sometimes [the tariff is] shared, sometimes passed back to the exporter, and sometimes the importer will absorb it and pass it on to the consumer.”
Cost Absorption and Supply Chain Challenges
The pressure is mounting on wineries to decide whether to absorb the costs or pass them down the supply chain, with the per-bottle tariff jump from 10 cents to $1.10. “The bigger the tariff the more difficult it’s going to be to absorb those costs,” Wilson said.
While New Zealand’s wine sector has thrived on its reputation for quality, the latest US move spotlights how vulnerable small, export-reliant economies can be when trade terms shift abruptly.
The country’s winegrowers are currently relying on strong branding, loyal customers, and sustainable practices to weather the storm—though the financial squeeze will be felt across the industry.