Wineries say they'll take demise of TPP in stride
After the United States' withdrawal from the Trans-Pacific Partnership and the trade boons is was expected to bring for Oregon wine, the owners of local wineries are saying 'c'est la vie' and do not expect much of an impact.
While some said it was short-sighted, at least from an agricultural standpoint, to pull out of the deal, which would have removed obstacles and duties on wines heading to important importers like Canada and Japan, they plan to forge on without it as they have been.
"Oregon makes the best pinot noir in the new world, by far," asserted Alex Sokol Blosser, winemaker and co-president of Sokol Blosser Winery in the Dundee Hills. "This would've allowed us to better compete in the markets where we're competing head-to-head with other New World pinot noirs. So, we will continue to be competitive because we make the best New World — not just Sokol Blosser, us in Oregon, Oregon producers — make the best new-world pinot noir in the world, and we're not afraid to compete."
President Donald Trump issued an executive order in January withdrawing the United States from the international trade deal negotiated toward the end of Barack Obama's administration with his endorsement. The deal, which would have loosened trade restrictions and tariffs between the United States and 11 other Pacific Rim countries — Australia, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Chile, Brunei, Singapore and Vietnam — was often maligned during last year's presidential campaign. Sokol Blosser noted that the United States' withdrawal from the agreement was hardly a surprise after the nominees of both political parties repeatedly attacked it on the campaign trail.
Area winemakers reached last week indicated that Canada is by far the largest export market for Oregon wine. Within the other countries involved in the TPP, Japan is the next largest export destination for local wines.
"Without TPP, we will not have enhanced abilities to sell to Asia, unlike other countries we compete with, where (they) help put together marketing groups and facilitate trade," said Harry Peterson-Nedry, founder of Chehalem Winery, in an email.
While he did not have recent data on hand, Sokol Blosser said the TPP would have brought the especially high tariff on wine exported to Canada to zero and brought Japan's tariff nearly to zero over time. He said the existing tariff's give an advantage to wine growers in New Zealand facing less tariffs.
He said Sokol Blosser has already been aggressively marketing internationally, noting that exports make up about 20 percent of the winery's sales chiefly to Canada, Japan and the United Kingdom.
"We've been dealing without the TPP for a long time," Sokol Blosser said. "So, if it passed it would have been awesome, but now that it's not, we've been living with it. We will continue to work closely with those countries and those markets and keep going."
However, David Adelsheim, president and co-founder of Adelsheim Vineyard, said he was a "lukewarm supporter" of the TPP, noting that Adelsheim does not sell much wine in Asian markets.
While he said the expected benefits of the deal would have been helpful, he was persuaded by the argument that the United States should seek to make more smaller-scale, bilateral trade agreements with countries that are less likely to take American jobs.
On the other hand, Adelsheim said he is concerned about Trump's threats toward the North American Free Trade Agreement with Mexico.
While he noted that the president cannot singlehandedly end that trade agreement with Mexico and Canada, he said Canada has targeted American wine for tariffs in the past and could do so again if Trump goes too far.
"While nobody's going to go out of business because of it, I don't think – it's hard to imagine that for anybody it's so important that they would risk their business – but it would be business that everybody likes doing and that gives some international exposure," Adelsheim said.
Acknowledging that groups representing other sectors of the United States' economy saw reason for concern with the TPP, Sokol Blosser suggested that the agreement should have focused on agriculture specifically.
Although not too disappointed to see TPP go, Adelsheim did worry that the Trump administration will not prioritize new trade deals in the future.
"I think the thing that's sad is not in and of itself that TPP was cancelled, but probably no work will go on for the next four years to even do bilateral work with a place like China where it would be probably helpful to both countries, just because Trump is so opposed to anything that isn't just about America," he said.