The Impact of Trade Tariffs on Barrel Travel
Effective Wood Management in uncertain times
As global trade tensions rise, spirits producers are being forced to rethink long-term strategies and investments. Tariffs and shifting international relations are not only affecting finished goods, but also disrupting the supply chain for one of the industry’s most vital components: barrels.
Barrels are far more than containers — they influence flavor during cask finishing and the maturation process. Any deviation from established barrel types used in aging or finishing processes can alter a product’s taste profile, making consistency a challenge.
Today, the barrel market is under pressure from all sides: tariffs, rising wood procurement costs, and growing supply chain volatility.
Tariff Turmoil
In April, the European Union proposed a 50% tariff on American whiskey imports in response to a sweeping 10% import tariff imposed by the US on various foreign goods. Although bourbon was later removed from the EU’s retaliation list, following lobbying from France, Italy, and Ireland – who felt their own products could become collateral damage due to their dependency on bourbon casks.
Spirits producers on both sides of the Atlantic have voiced serious concerns. A spokesperson for the Distilled Spirits Council of the United States (DISCUS) cautioned:
“Re-imposing these debilitating tariffs at a time when the spirits industry continues to face a slowdown in the US marketplace will further curtail growth across the country.”
Scotch whisky producers share similar concern. The sector was previously hit with a 25% US tariff on single malts in 2019 — a move that cost the industry an estimated £600 million over 18 months, according to the Scotch Whisky Association.
This is an evolving situation. At the time of writing, the US Court of International Trade has blocked new trade tariffs. However, the US government intends to appeal, and retaliatory measures proposed by other countries remain on hold. The has resulted is a precarious stalemate that continues to delay investment and strategic planning across the spirits industry.
Barrel Bottlenecks
The ongoing uncertainty is reshaping how distilleries approach aging and inventory management. Many producers are cutting back on how much product they age and how far into the future they’re willing to invest — and that’s having a ripple effect on the barrel market.
Some distilleries are choosing to dump their products earlier than usual to avoid rising costs and anticipated tariffs. The result? A surplus of used barrels flooding the market. International buyers, who were paying top dollar just a year ago, are now holding off in hopes of further price drops.
Meanwhile, tariffs continue to threaten to increase the cost of barrel transportation. Since barrels influence flavour and are even considered part of the recipe, they can’t easily be replaced with domestically sourced alternatives without compromising product quality.
White oak, which essential for bourbon barrels, has seen a sharp rise in cost due to surging demand, labor shortages, and concerns around forest regeneration. These factors have driven the Associated Cooperage Industries of America (ACIA) to unite with spirits producers under the Toasts Not Tariffs Coalition, urging the US government to establish lasting trade agreements with the EU and UK.
In this environment, producers are increasingly focused on how to extract maximum value from existing inventory. That’s where intelligent wood management programs and effective barrel utilisation come into play.
Wood Management
DRAMS offers an advanced Wood Management module that enables distilleries to track barrel usage independently from the spirit it holds. From procurement and repairs to multiple fill cycles, dumping, resale or decommissioning — DRAMS tracks the complete lifecycle of every barrel.
The DRAMS Wood Management Module empowers distilleries to:
- Maximise barrel utilisation without the need for new investment
- Monitor supplier performance and repair quality
- Extend barrel lifespans through optimised fill cycles
- Track spirit quality trends linked to individual barrel histories
- Improve resale value by maintaining and documenting barrel condition
- Protect product integrity by removing end-of-life barrels from circulation
As we enter the second half of 2025, it’s clear that wood management has become more than a quality assurance strategy — it’s a financial necessity. Whether trade barriers will recede or escalate, proactive wood management and effective barrel utilisation will play a vital role in helping distilleries to achieve more cost efficient operations.
Want to learn more?
Join DRAMS Managing Director, Brendan Flood, on Wednesday 25th June, for an exclusive webinar on effective wood management and cask utilisation.
Register for the DRAMS Wood Management Webinar or reach out to our team to discuss your barrel inventory tracking needs.
