Exporting French wine to the USA

The American market offers excellent opportunities for French wine exports. Consumption habits, regulations, taxes: Les Grappes tells you more about exporting wine to the USA.

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Wine sales and consumption in North America

The USA, the world's leading wine-consuming country

For some ten years now, the United States has been the world's leading consumer of wines and spirits, in terms of value. However, Americans are not big wine consumers: only 12.2 liters per capita per year, a far cry from the 51 liters consumed by the French, for example.

In the U.S., it's mainly still wines, especially white wines, that find enthusiasts. Local production plays a major role: 74% of wines consumed come from American vineyards, 66% from the state of California alone. But foreign wines, and French wines in particular, are also well represented on the market.

French wine in the USA

The American market is an important one for French wines: it is the country that imports the most, accounting for 19% of wine exports by value in 2022. And the trend is upwards: in 2022, wine exports to the United States represented 2.1 billion euros, compared with 1.9 billion in 2019 and 1.4 billion in 2020 during the health crisis.

In 2019, French wines accounted for 34.15% of wine imports to the USA. Since the first half of 2022, the USA has become the biggest consumer of French wines by volume, overtaking Germany, the historic leader.

Lovers of fine wines, Americans consume a lot of still wines, and are particularly fond of the great red wines of Bordeaux and Burgundy. Demand is particularly strong in California, Texas, Florida and Illinois. Sparkling wines and bulk still wines come in second and third place among imported wine products.

Exporting wine to the USA: what you need to know

Legislation and trade organization in the USA are complex. This is often an obstacle for anyone wishing to sell wine in the United States. Before entering the market, it's important to understand how it works.

The three-tier system

Wine marketing in the United States is governed by the "Three Tier System". This three-stage system means that to sell wine to the American end consumer, you have to go through three intermediaries.

The first is the importer. It is the importer who buys the wine from the foreign producer. He must hold a specific license, valid throughout the U.S., to sell his products to a distributor (or wholesaler).

This is the second intermediary. These distributors generally hold licenses specific to each state, enabling them to resell wines to retail outlets or CHR (cafés hôtels restaurants).

These are the third intermediary before the final consumer can buy the wine. The wine is then consumed "on-premise", i.e. on the premises (bars, restaurants, etc.) or "off-premise", via takeaway sales at a wine shop or supermarket.

This three-tier system partly explains why the price of French wine in the USA is often high.

American taxes on French wine

Once this system is understood, it's important to know what taxes and fees will apply to a bottle of wine exported from France to the USA.

Like all alcoholic beverages, wine is wine is subject to taxes such as VAT and excise duties. It should be noted that customs duties on a bottle of wine are generally quite low, and are less significant for the United States than for the European Union. Bulk wine, on the other hand, has a higher tariff in the USA than in the EU.

Also of note in recent years: the "Trump tax". Implemented in October 2019 by the Trump administration, it imposed a 25% surtax on European still wines grading less than 14% vol. and packaged in sizes of less than 2 liters. This decision had a heavy impact on the French export market until 2021, when it was suspended for five years.

Today, the sector is breathing a sigh of relief thanks to the lifting of the ban and the recovery of the Covid-19 post-crisis market.

Sending wine to the USA

Any producer wishing to sell French wine in the USA must follow certain steps:

• Register with the US Food and Drug Administration ( FDA ) to be able to sell in the USA (to be renewed every two years).
• Create wine labels adapted to the American market and obtain the Certificate of Label Approval. The biggest difference with French labels? The name and address of the American importer must appear on every bottle, in addition to all the legal information required for export sales.

As you can see, selling French wine in the USA is subject to numerous laws and regulations. But the market is buoyant and continues to represent a great opportunity for French wine producers.