Tariffs are hurting Washington's whiskey industry

Now it’s Washington state whiskey distillers who are feeling the sting of the tariff battle.

Canada and the European Union have imposed tariffs in retaliation for the Trump administration’s decision to tax steel and aluminum imports.

Don Poffenroth, president of Dry Fly Distilling in Spokane, said an order for 2,000 cases headed to Canada was canceled last week. That’s $200,000 in whiskey – almost 10 percent of his business.

Poffenroth said the canceled order doesn’t just hurt his distillery.

"It means we buy less grain from our farmers, less bottles from our bottle manufacturers, and all of our vendors are impacted," he said. "And 10 percent of our overall business means we have to change our labor hour distribution and our approach to the market."

Last year Washington state exported $96,000 in whiskey. But American whiskeys have been growing in popularity internationally.

Kirby Kallas-Lewis runs OOLA Distillery on Capitol Hill.

This week his company had to ditch their plans to start exporting to Europe, an expansion he said could have grown their business by a third.

“It was extreme disappointment because really in the next 12 months this was kind of our timeline to start the wheels in motion to actually export,” he said.

Both Kallas-Lewis and Poffenroth said their only option now is to continue to expand distribution nationally.