Alcohol beverage importers may finally get their answer from the United States Supreme Court this week on the validity of the Trump Administration’s tariffs issued pursuant to the International Emergency Economic Powers Act (IEEPA).[1] Recent news reports suggest that the Court’s answer may come as early as this Friday, when the Court is scheduled to issue opinions on pending cases. Based on the questions posed by both liberal and conservative justices during oral argument, many commentators expect the Court to conclude that the president exceeded his authority by invoking IEEPA to issue those tariffs.   There are, however, a lot of open questions beyond just the validity of the tariffs. Most importantly, if the Court finds the tariffs are invalid, will importers that have already paid the tariffs be entitled to refunds and what will the process be for getting those refunds. Questions also remain as to whether the case will be remanded to a lower court to determine the

Another month of calm November typically marks the end of a new harvest and the middle of our busiest sales quarter. October’s government shutdown created unbelievable market uncertainty. But with the system back up and Thanksgiving almost normal, stability returned rather than the predicted surges or collapses by pundits from both sides. Still, questions remain about the future of our economic recovery prospects. For now, it is a reprieve, allowing us to regroup for the new year. Market dynamics The delayed reports from Commerce and the Bureau of Labor Statistics have started to trickle in, bringing some key takeaways: Unemployment is holding at 3.8%. Inflation easing to 2.3% YoY. Consumer spending down ~2% from Q3, but no hint of a cliff. As we close out the year and look to 2026, the focus will be on staying agile in both supply planning and capturing winery sales and marketing opportunities. The key trends persist: Steady demand, no major swings, and a growing gap between spe

The wine industry continues to reflect the geo-political uncertainty of the world. While Cabernet has been testing the mettle of growers and winemakers, with a heat spike to make things even more challenging, the themes of logistical efficiency, manufacturing constraint and growing demand also continue to the forefront. Freight costs from Asia to the US have shown some relief, with a 4% decrease for the West Coast and a 3% dip for the East Coast, which could slightly reduce import expenses. Canadian rail operations remain stable for now, but potential disruptions loom as labor negotiations continue. Similarly, there is potential for a West Coast port strike. The US barely avoided a prolonged East Coast port strike commencing October 1st, 2024; the strike was suspended on October 3rd. If it had proceeded for longer, it would have created significant bottlenecks in supply chains, affecting shipments between Maine and Texas. Trade and Duty Updates In a major development, the US Interna

In recent years, a minimalist design approach has become a core strategy for marketers and designers. This style is characterized by the use of simple decoration, colors, and typography, appealing to consumers due to the sleek and aesthetically pleasing look.  Producers are expected to keep up the ever-evolving consumer tastes – and this includes wine packaging. The packaging of wine is often challenging for most wine manufacturers as there are many different factors, for example the wine bottle shape and color, closure, label design, and boxes.  There are many different reasons as to why a consumer will purchase a particular wine. Taste is obviously a significant factor, but experience with the brand and appeal of the packaging is just as important.  When designing wine packaging, sometimes less is more. Simple packaging techniques can attract customers and be just as effective as more elaborate designs. There are two basic approaches to minimalist packaging:&nbs

Welcome to the August update from our friends at Saxco, on market dynamics in beverage packaging. This update first appeared in August’s Ciatti California Report, which you can find on Substack here.  Despite the macro-economic challenges, the CrowdStrike outage, the geopolitical tensions, and the exciting Olympics, the wine packaging market has remained rather stable for the last month.  However, the US Department of Commerce (Commerce) recently made affirmative preliminary antidumping (AD) determinations regarding glass wine bottles and similar glass bottles (740ml-760ml) imported from China, Mexico, and Chile. As a result of these preliminary findings, imports of in-scope glass bottles will incur AD cash deposit requirements at rates within the ranges indicated below. As with the countervailing duty (CVD) cash deposit requirements announced in May 2024, AD cash deposits represent payments of estimated tariffs, and any final AD tariff liability will be dete

This update first appeared in June’s Ciatti California Report, which you can find on Substack here. Market Dynamics The market is still stable, but a major event has occurred that could potentially have significant implications for the glass market. On December 29, 2023, a petition was filed alleging that imports from Chile, China, and Mexico are unfairly traded and injure the US glass bottle industry. The petition has led to investigations by the US Department of Commerce and the US International Trade Commission. Commerce is assessing whether imports from China receive unfair government subsidies and whether imports from all three countries are being sold in the US below fair value (i.e., whether the imports are being “dumped”). The ITC will determine whether these imports injure or threaten the domestic glass industry. On May 29, 2024, Commerce announced its affirmative preliminary determinations of subsidies and critical circumstances in the Glass Wine Bottles fro

Afternoon Brief, February 16th

Hoopes Winery Civil Trial in Napa County Wraps After 11 Days, Ruling Could Take Months: Whether Napa Valley vintner Lindsay Hoopes has been using company structures as a shield against liability was the focus Wednesday of the 11th and final day of trial in a county lawsuit over alleged winery permit violations...

Happy New Year! It is time to dust off the employee handbook, review your policies and procedures, and make sure they comply with all the new laws, regulations, and interpretations that have either already gone into effect or will in early 2024. Below, we have identified our “top 10(ish)” changes.  Please keep in mind there were hundreds of laws, regulations, and changes implemented at the local, state, and federal levels throughout 2023.  So, if you need a handbook/policy review or have any questions, please call.  1. California and Local Minimum Wage Raised – In addition to the gradual increase to minimum wage by the state, several Sonoma County cities have increased minimum wage beyond that required by the state.  Below is a table that describes the state and local city requirements:                     Locality Effective Date All Employers California 1/1/2024 $16.00 Santa Rosa 1/1/

Policy Perspectives  The EAEA—Expanding Ag Exports In an encouraging example of bipartisan action, groups of Democrat and Republican Senators and House Members, plus one Independent, have joined together to sponsor legislation expanding funding for agricultural exports, including wine. On the House side, the lead sponsor is Rep. Dan Newhouse (R-WA), a wine grape grower himself as well as being co-chair of the Congressional Wine Caucus, chair of the Agriculture Appropriations subcommittee, plus a great supporter of the American wine industry. Titled “Expanding Agricultural Exports Act” (EAEA), the bill proposes doubling the funding for both the Market Access Program (MAP) and Foreign Market Development Cooperative Program (FMD) administered by the US Department of Agriculture. Between 1977 and 2019, these programs have added an average of $9.6 billion annually to the value of US agricultural exports, equal to nearly $648 billion, or 13.7%, in additional export rev