GENEVA — As President Donald Trump's trade war with China continues, area winemakers are keeping a close eye on how tariffs could affect the local market.
China on Wednesday said it will exempt American industrial grease and some other imports from tariff increases, though it kept in place penalties on soybeans and other major U.S. exports ahead of negotiations next month, according to the Associated Press.
The move could indicate that both sides are settling in for an extended conflict even as they prepare for talks in Washington aimed at ending the dispute that threatens global economic growth, the report states.
The tariff's have already had a substantial impact on agricultural markets, especially soybeans which have been piling up around the Midwest. Farmers and co-ops have seen steep declines in the price per bushel they can get for their harvests.
Now, those in the wine industry in Ashtabula County are waiting to see how the tariff's all play out and what impact the situation could have on the ability to compete with larger, national wine producers in California, Oregon and Washington.
Donniella Winchell, executive director of the Ohio Wine Producers Association, said local wine producers do not export product overseas. Nearly 100 percent of wine produced in Ohio is sold within the borders of the state to tourists, Winchell said.
"The tariffs themselves will not directly impact the wineries here because they do not export," she said.
However, the bigger producers in places like the Napa Valley, California, do export and have aggressively pursued export markets, Winchell said.
As the tariffs create a price increase in China, which Winchell said has resulted in prices of wine in some cases being double what they were before the tariffs, the bigger producers might start trying to push the product that isn't selling there in domestic markets here.
"As they're looking at those wines being rejected and slots on Chinese shelves being filled by Australia and European markets, the Americans are saying 'what are we doing with this product and what happens if this continues,'" Winchell said. "They'll begin looking at shelf space in the U.S."
The main concern is that such a shift will have an indirect impact on Ohio wine producers in Ohio as West Coast wineries start to encroach upon shelf space that local markets have been working to fill and gain for a decade, Winchell said.
"It hasn't happened yet, and it isn't occurring at this moment, but it is something we are all watching," Winchell said.
The Ohio Wine Producers Association is working closely with other trade associations on the West Coast in an effort to not look at one another as competitors, but as allies in ways to expand consumption, Winchell said.
If there is a silver lining, Winchell said it is that local producers are all looking at how they can broaden their reach within the United States. In Europe the statistics show that adults drink about 20 gallons per capita of wine and in the United States the number is around three and a half gallons per capita, she said.
Should the situation play out, Winchell said producers are hoping to gain ground in a more regional area and to tap into the tastes of wine consumers who tend not to be brand-loyal but loyal to certain kinds of wine.
"The goal is to broaden the base of awareness and wine choice," Winchell said.
Representatives at the national trade association WineAmerica, which serves the interests of wineries in all 50 states, could not be reached for comment.
The Associated Press contributed to this story.