BBC: 'Is it for a day or four years?' Tariff uncertainty spooks small businesses

Donald Trump's talk of applying new tariffs to goods from America's biggest trade partners has sparked months of uncertainty for business owners.

On Saturday, the president made good on his threats, ordering a new 25% tax on shipments from Mexico and Canada and raising existing tariffs on goods from China by 10%.

But that has not stopped the questions.

"Is it for a day, is it a political flex or is it something that will last for four years?" asked Nicolas Palazzi, the founder of Brooklyn-based PM Spirits. He runs a 21-person business that imports and sells wine and spirits, about 20% of which come from Mexico.

Trump's orders set in motion threats that the president has discussed for months, striking at shipments from America's top three trade partners, which together account for more than 40% of the roughly $3tn goods the US imports each year.

Canadian oil and other "energy resources" will face a lower 10% rate. But otherwise, there will be no exceptions, the White House said.

Trump said the tariffs were intended to hold Canada and Mexico accountable for promises to address illegal immigration and drug trafficking.

The measures go into effect on 4 February and are to remain in place "until the crisis is alleviated," according to the orders.

If the plans were not a surprise, they still presented a potentially stunning blow to many businesses, especially for those in North America. The three countries have become tightly linked economically after decades of free trade under a treaty signed in the 1990s, known then as Nafta and updated and renamed under the Trump administration to USMCA.

The growth of mezcal in the US, brought in by businesses like Palazzi's, has been part of this shift.

Since 2003, consumption of tequila and mezcal has roughly tripled, increasing at a rate of more than 7% each year, according to Distilled Spirits Council, a trade group.

Overall since the 1990s, trade in spirits between the US and Mexico has surged by more than 4,000% percent, said the organisation, which issued a statement after the president's announcement warning that the tariffs would "significantly harm all three countries".

For months, Palazzi has been fielding nervous questions from his suppliers in Mexico, who are typically small, family owned businesses and may not survive if the tariffs are prolonged.

If it sticks, he said the 25% tax on the bottles of mezcal, tequila and rum he brings in will push up prices - and sales will drop.

"Definitely this is going to impact the business negatively. But can you really plan? No," he said. "Our strategy is roll-with-the-punches, wait and see and adapt to whatever craziness is going to unfold."

Economists say the hit from the tariffs could push the economies of Mexico and Canada into recession.

Ahead of the announcement, Dan Kelly, president of the Canadian Federation of Independent Businesses, described the looming tariffs from the US, and expected retaliation, as "existential" for many of his members.

"Look, we get that the government has got to respond in some fashion …. But at the same time we urge the government to use caution," he said, comparing tariffs on imports to chemotherapy: "It poisons your own people in order to try and fight the disease."

"It's going to have an effect everywhere," said Sophie Avernin, director of De Grandes Viñedos de Francia in Mexico, noting that many Americans own Mexican alcohol brands and Modelo beer is actually owned by a Belgian company.

Trump, who has embraced tariffs as a tool to address issues far removed from trade, has dismissed concerns about any collateral damage to the economy in the US.

But analysts have warned the measures will weigh on growth, raise prices and cost the economy jobs - roughly 286,000, according to estimates by the Tax Foundation, not including retaliation.

Those in the alcohol business said the industry had already been struggling to emerge from the shadow of the pandemic and its after-shocks, including inflation, which has prompted many Americans to cut back on dining out and drinking.

Smaller firms, who typically have less financial cushion and ability to swallow a sudden 25% jump in cost, will bear the brunt of the disruption.

"I'm pretty frustrated," said California-based importer Ben Scott, whose nine-person business Pueblo de Sabor brings in brands from Mexico such as Mal Bien and Lalocura.

"There's just a huge cost that's going to affect so many people in ways other than they're paying a couple bucks more for a cocktail, which doesn't sound like a tragedy."

Fred Sanchez has spent years pushing to expand his business, Bad Hombre Importing, a small California-based importer and distributor of Mexican agave-based spirits like Agua del Sol, and was recently working on deals in New York and Illinois.

But his potential partners started hesitating as Trump's tariff talk ramped up last year.

Now, instead of expanding, he is contemplating selling off his stock of liquor and possibly shutting down. He said he had little capacity to absorb the jump in costs and saw little scope for raising prices in the current economy.

"25% is just not something that we can realistically pass onto the consumer," he said.

Sanchez said he believed that Trump might be using tariffs as a negotiating tactic, and the tax could be short-lived. Still, for his business, damage is already done.

Robb Report: The 11 Best Cognacs to Buy Right Now

Cognac might not get as much attention as whiskey, particularly when it comes to bourbon or single malt scotch, but there’s a whole world of this French spirit to get familiar with and sample. There are a few rules to know—Cognac is a brandy made from grapes in the eponymous region or France that is aged in French oak barrels, either new or ones that have been used to age grape-based spirits. There are a few age designations to understand, from V.S. (at least two years old) to X.O. (minimum 10 years old). Cognac can be used to make a wide variety of cocktails, but is wonderful to sip on its own as well. We’ve put together a list of some of the best Cognacs in different categories to help you navigate this growing field, so happy hunting and santé.

Our Best Cognac Picks

• Best X.O. Cognac: Frapin X.O. VIP

• Best Single Cask Cognac: PM Spirits Rémi Landier XO Single Cask Collab

Best X.O.

Frapin X.O. VIP

X.O. (“extra old”) is the next level of age in Cognac, a designation that means the eau-de-vie has been matured for a minimum of 10 years. X.O. is prime sipping Cognac, and one of the best in this category comes from Cognac Frapin. This is a single estate expression made from grapes grown in the Grande Champagne cru, and the eau-de-vie is aged in the humid cellars onsite. This is a thoroughly sophisticated sipper, with notes of caramel, chocolate, and dried fruit on the palate.

Best Single Cask

PM Spirits Rémi Landier XO Single Cask Collab

PM Spirits sources a wide array of spirits from different producers in various countries in all spirits categories. This Cognac is a small release that is worth tracking down, and it’s notable for being a single cask release as opposed to a blend of barrels. The producer is Remi Landier, a small family business that has been around since the 1970s. This particular Cognac was distilled in 1997, and is a blend of eau-de-vie from Fin Bois and Petite Champagne. If you’re looking to really expand your knowledge and palate in the world of Cognac, give this bottle a try.

Los Angeles Times: A mecca for mezcal: These are the best agave bars in L.A.

“You’ve got to put a bottle of mezcal on the ofrenda,” says Ivan Vasquez, owner of Madre Oaxacan Restaurant & Mezcaleria, with four locations across L.A. County and the largest small-batch mezcal collection in the U.S. “For me, and back in the villages, a bottle of mezcal has to be there.

“On Día de los Muertos, you drink a copita with your loved ones,” Vasquez instructs. “It’s the only spirit that keeps our loved ones alive. When I drink mezcal on Día de los Muertos, I’m reunited with my grandpa. Thanks to him, I was introduced to mezcal.”

While tequila has had a couple centuries to gain an international following, the rise of mezcal and regional spirits like sotol and bacanora is more recent. It was only in the ‘90s that mezcal gained Denomination of Origin (DO) status, which restricts legal and commercial use of the word, and paved the way for it to be sold across the globe.

The spirit, which imparts earthy tasting notes, exploded in popularity over the pandemic, partially because of the heritage involved — mezcal producers, or mezcaleros and mezcaleras, often utilize methods that have been honed across generations and are unique to their family or village. The final product, Vasquez says, delivers a flavor that can be more layered and complex than wine.

Also known as maguey, the spiky agave plant has been revered by Indigenous Mexicans for millenniums, providing food, practical items such as rope and sandals and fermented beverages like pulque. When Spanish colonizers arrived with the still, agave wine was distilled into spirits like tequila, made exclusively from agave tequilana, and mezcal, which can be made from over 40 other agave types.

“Los Angeles is like the mecca right now for agave distillates,” said Rocío Flores, a mezcalera who grew up splitting time between L.A. and Jalisco and now hosts agave tastings and educational experiences, including the program at Guerrilla Tacos. “It’s probably the one place in the world where you can find the most diverse, the most amazing mezcals that you can’t even find in Mexico in one place all together.”

The global appreciation for Mexico’s ancestral spirits has influenced the tequila industry too. For his part, Vasquez only works with small producers and serves tequila blanco exclusively — no reposados or añejos. When customers ask for corporate brands like Casamigos, he and his staff use it as an opportunity to educate.

“I tell them, ‘Let me bring you several options that are higher proof at a lower price’ and I ask them to enjoy it neat,” he says. “They’re just amazed when they try it.”

L.A. was already a great place to drink agave distillates, but these days the options are overflowing. Included on the list below are agave-focused bars that prioritize stocking small-batch producers and offer flights that encourage imbibers to sip in the traditional style. Some, like Vasquez, even sell rare bottles out of their bars. Whether you’re toasting in celebration or stocking up to savor with your ancestors on Día de los Muertos, these are the best agave bars in Los Angeles.

Barrel Hunting in Cognac: Unearthing Hidden Treasures in Dusty Old Cellars

There’s a popular vision of Cognac that’s all blinged out and dripping: crystal decanters, tasting rooms that look like jewelry stores and five-figure bottlings. This image is dominated by a handful of huge brands everyone recognizes: Hennessy, Martell, Rémy Martin and Courvoisier—the so-called Big Four, which sell nearly 90% of the Cognac consumed worldwide, according to the International Wines and Spirits Record. But there is another side of Cognac, too. One that’s based more on the gritty agricultural reality of the region.

I saw it on a cold, gray day last winter at an unassuming farm in the small village of Verrières. This was probably the last place I’d expect to find pricey Cognac, but I was on a barrel hunt with Guilhem Grosperrin, among the new wave of négociants whose limited-edition releases are quickly becoming the most coveted bottles in Cognac. We visited one of the 150 small producers in his network, where Grosperrin crawls around old cellars looking for rare brandies.

When we arrived at the farm, four barking dogs rushed out to us, followed by a ruddy-faced septuagenarian who was still dressed from his boar hunt earlier in the day. Cognac is a secretive, rivalrous place and I was introduced to the man in hunting attire as only Marcel, no last name. Marcel eyed me suspiciously, then asked, “Well, does he like to drink?” Grosperrin chuckled and told Marcel that, yes, I liked to drink very much. With the ice broken, we stepped into his dark, dusty cellar to taste from his barrels, which had been aging since as early as the 1980s. “Sorry it’s dirty in here. I haven’t distilled since 2012,” Marcel said.

The nonstop luxury messaging from the Big Four makes people forget Cognac’s origin as wine. We sipped liquid from Marcel’s barrels that had begun as grapes in the family’s 10-hectare vineyard, which he picked, pressed, fermented and distilled. It’s a similar story for the roughly 4,300 winegrowers in Cognac, most of whom grow less than 20 hectares specifically for Cognac production. During his career, Marcel sold most of his stock to one Big Four house or another. But he always saved a few special barrels for himself. “What they keep is for pleasure, or patrimony, or as souvenirs, or for reasons that are not necessarily logical,” Grosperrin told me.

By age eight, Marcel was able to light the still, which he did in the morning while his father tended to the cows. Marcel remembers a wealthy neighbor who’d been a prisoner of war in Germany during World War II. That man wrote to his family from prison: “Cut down all the trees if you have to, but don’t stop distilling. Distill, distill, distill.” After the war, this guy’s cellar was full, and he became rich. Meanwhile, Marcel’s family had to rebuild its stocks. “The value of money is just in your head,” he said. “But the value of Cognac is solid, and you don’t lose it.”

To whiskey drinkers, single-cask offerings may seem like old hat. But it’s a relatively new phenomenon in brandy. Cognac is actually following a model that’s already been successful for Armagnac. Single-barrel Armagnac from négociants like L’Encantada are catching the fancy of American whiskey connoisseurs tired of paying whiskey prices. The problem in Armagnac is that the existing stock of barrels is small and shrinking.

That offers an opportunity for Cognac, where there is seemingly endless stock. Though, as Grosperrin points out, “It’s much more complicated to buy a cask here than in Armagnac. In Cognac, the producers are richer, and they don’t need small independent bottlers. They have contracts with the big houses.”

It’s still the early stages for the single-barrel Cognac revolution, and we’re just beginning to see these bottles in the U.S. La Maison du Whiskey’s “Through the Grapevine” series was one of the first to appear. PM Spirits has done several limited-edition bottlings, and this year has released rare single-cask offerings from renowned producers Frapin and Remi Landier. Last spring, Grosperrin released bottlings in the U.S. for the first time in several years. Importer Heavenly Spirits has released two single-barrel bottlings from the famed estate Jean Fillioux. Vallein-Tercinier and Jean-Luc Pasquet have plans to bring more of their single-cask offerings into the States.

To be clear, at the moment, single-barrel Cognac is still the domain of aficionados, with prices running more than $200 per bottle. But they’re still a fraction of something like Rémy Martin Louis XIII or Hennessy Paradis Imperial (both more than $3,000). Much of the price of those blingy brand names is wrapped up in specially designed decanters. The new wave of single-barrel offerings is something rarer and scarcer. “This is for people who want the unexpected. It’s a different philosophy. It’s outside of the current market,” said Vingtier.