AILSA CHANG, HOST:
New Trump administration tariffs are threatening to drive up prices for a wide variety of gourmet foods from Europe, including Italian cheeses, Spanish olive oil and French wine. But a Florida company has found a loophole in the wine tariff that is big enough to drive a truck through. NPR's Scott Horsley reports.
SCOTT HORSLEY, BYLINE: Florida Caribbean Distillers wasn't thinking about tariffs when it uncorked this plan. The 76-year-old company, best known until now for rum and sangria, was just trying to get a toehold in the burgeoning market for rose wine.
DAVE STEINER: Not only was rose outperforming in the wine category, but specifically, French rose was seeing a very good surge in popularity with American consumers.
HORSLEY: National sales vice president Dave Steiner says the company teamed up with a rose supplier that's well-connected with French vineyards in the Nimes region just outside Provence.
STEINER: It's the Southern Rhone Valley, which actually dates back in terms of wine-growing to the Roman Empire, so it really has about a 2,000-year run of wine-making history.
HORSLEY: Steiner's strategy is to put that old French wine into new American bottles. The company already had a state-of-the-art bottling plant halfway between Tampa and Orlando. It ships the wine across the Atlantic in tractor trailer-sized containers lined with a giant pouch. Imagine the world's largest wine in a box.
STEINER: Depending on the size of the order, it could be a 20-foot or a 40-foot shipping container. Roughly, it's several thousand gallons at a time that we can bring in.
HORSLEY: And that's fortuitous because the Trump administration's new 25% wine tariff only applies to bottles up to two liters. Bulk wine, it turns out, is exempt, so Steiner's company suddenly has a 25% cost advantage over rival rose importers.
STEINER: It was nice timing on the tariff's part. It certainly was a bit of a gift, but we'll take it.
HORSLEY: What Steiner's company is doing here is perfectly legal, but economist Mary Lovely of the Peterson Institute for International Economics says companies will go to unusual lengths to circumvent protectionist measures. The results are sometimes inefficient or even corrupt.
MARY LOVELY: It does create this ecosystem which is not particularly healthy for economic activity.
HORSLEY: For now, Florida Caribbean Distillers is enjoying its unexpected windfall. The company's marketing its first 50,000 cases of wine under the brand name La Rosey using the hashtag #TrumpTariffFree. Steiner expects the wine to retail for about $8.99 a bottle.
STEINER: I'd like to call it a very easy-drinking wine that can certainly claim to be with serious foodie roses but also has red berry fruits such as strawberry and raspberry, making it very approachable.
HORSLEY: Old World terroir with subtle notes of Florida's I-4 corridor and a smooth finish of tariff evasion. The company plans to add a sauvignon blanc and a pinot noir next spring.
Scott Horsley, NPR News, Washington.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.