West Cork distiller seeking clarity and aid amid US whiskey tariff

The co-founder and managing director of a West Cork whiskey distiller has appealed to the Government to ensure alcohol products are exempted from what he described as a “problematic” 15% tariff on goods being exported from the EU to the US. 

His comments come following last week’s announcement of a trade deal between two of the world’s largest trading blocs.

Michael Scully, of Clonakilty Distillery, told The Echo there was a still a lot of uncertainty around what was included in the new 15% tariff announced after the meeting between US president Donald Trump and EU Commission president Ursula Von der Leyen at Mr Trump’s golf resort in Scotland.

“It’s still very uncertain, we’re still not sure whether spirits are included or excluded from the new tariffs,” he said. “If they are included, it’s going to be very problematic.

“15% doesn’t sound like a whole lot, but it is because it takes us into totally different price points for our whiskey in the US markets.”

Mr Scully said it would mean a bottle of whiskey that might have cost $50 (€43.20) up to now will be priced closer to $60 now.

“It really is borderline as to whether it makes sense for us to keep on supplying the US market with some of our products,” he said.

“I think what we have to do is take a really long, hard look at everything and really question the wisdom of sending premium products to the US market.”

Big blow

The Clonakilty Distillery has been up and running for six years, and last year sold 20% of its total output — including whiskey, gin, and vodka — to the US. While business in Ireland is good, losing its US business would be a big blow to the West Cork company.

It employs 32 people directly and up to 50 more indirectly in farming and maintenance and other related functions.

At present, the Clonakilty company is hoping that an exemption can be secured for spirits from the 15% tariff.

“I think we would have to urge the Government and the EU to do everything they can to ensure spirits aren’t included,” Mr Scully said.

"Failing that, there would have to be measures introduced to ease the burden on companies like Clonakilty Distillery and its close neighbour in Skibbereen, the West Cork Distillery.

“We would be looking at some form of compensation to save our jobs,” he said, pointing out Clonakilty Distillery was rooted in the community and as well as supplying jobs. They have also brought visitors to Clonakilty, the distillery has a visitor centre and tour and employed a lot of people “down the line”.

“In order to safeguard those jobs, I think we would be looking for the Government to intervene and provide some form of supports,” Mr Scully said. “We’re still a very young business, we’re only six years old, we’re selling very well in Ireland and our sales in Ireland are up 30% this year compared with last year — which is really bucking the trend.

“But you know, the US is a really important market for us, it’s not our only market but it’s an important market.”