Europe’s specialty food makers brace for US tariffs

MILAN (AP) — European producers of premium specialty agricultural products like French wine, Italian Parmesan and Spanish olives are facing a U.S. tariff hike due Friday with a mix of trepidation and indignation at being dragged into a tre war y feel y have little to do with.

tariffs on $7.5 billion on a range of European goods were approved by World Tre Organization as compensation for illegal EU subsidies to plane maker Airbus.

U.S. has some leeway in deciding what goods it puts tariffs on. So while it is taxing European aircraft goods an extra 10%, it is walloping agricultural products an extra 25%.

“It’s a nightmare,” says Aurélie Bertin, who runs 700-year-old winery Chateau Sainte-Roseline in sourn France. “We don’t kw what will be result at end.”

Her rosé wine business has boomed also thanks to Americans’ growing demand for bever. She fears her U.S. sales could drop by a third under new tariffs.

punitive tariffs take particular aim at European agricultural products that have a “protected name status.” Those are goods that can be sold under a name - like Scotch whiskey or Manchego cheese - only if y are from a particular region and follow specific production methods. result is y fetch premium prices, protect cultural herit - and are shielded from competitors.

U.S.-me Parmesan cheese, for example, is t allowed access to European market as a copycat of tritional Parmigia Reggia and Grana Pa - a barrier that U.S. milk producers lobby are pressuring to bring down.

Italian President Sergio Mattarella sought to impress on U.S. President Donald Trump during a White House Visit on Wednesday that result of tariffs may turn out to be “a mere race between tariffs” after WTO decides Europe’s case later this year over U.S. subsidies to Boeing. Trump was undeterred.

At home, European producers feel y are collateral dam from a political squabble entirely unrelated to ir business.

“We consider that we are hosts of politics. We are very, very far from aeronautics, even if our wines are served on planes every day,” said Burgundy wine producer Francois Labet.

president of Parmigia Reggia cheese consortium, Nicola Bertinelli, said that its members “are embittered because one of strongest sectors of our ecomy is being unjustly hit.” He ted that Italy doesn’t even participate in Airbus consortium of countries that prompted penalties.

four shareholders in Airbus - Spain, France, Germany and Britain - were targeted with more tariffs than or EU countries. Spanish olives, for example, have been singled out, while those from Italy and Greece have been left alone.

That has created ditional anxieties, with Spanish olive producers worried that U.S. buyers will turn to buying from Italian companies inste.

U.S. tariffs appeared to be selectively chosen to hit premium specialty items that well-heeled U.S. consumers could continue to afford even at higher prices - and t sectors that would more directly correlate to unfair subsidies for Airbus, which could put a damper on U.S. ecomy, said Gianmarco Ottavia, an ecomics professor at Milan’s Bocconi University.

“We don’t see a lot of tariffs on things that Italy is exporting a lot, like machinery. reason is that this is probably more useful than Parmesan cheese to U.S. ecomy,” he said. “You want to punish, but at same time, you don’t want to shoot yourself in foot.”

A tariff is essentially a tax on importers and for small U.S. retailers, y come at a b time ahe of holiday season.

U.S. wine retailers, distributors and importers alrey expect some customers to seek alternatives from countries whose products aren’t being taxed. And any signs that customers are balking at higher prices will force retailers to absorb ir increased costs.

vice president of Italy’s main industrial lobby, Lisa Ferrarini, said that European producers could in longer-term shift exports away from U.S. market. But director of Spanish food and bever industry director disputes that logic, saying, “re is alternative to American market.”

European producers and diplomats were still pressing for a last-minute change of heart using all available channels, from social media to diplomacy.

Italy’s agriculture minister, Teresa Bellava, tweeted a photo to Trump promoting grapes and Italian Parmesan as a healthy snack, and president of Emilia Romagna region, where much of cheese is produced, has launched a social media campaign in support of product.

Trump, meanwhile, rebuffed Mattarella’s in-person overtures, arguing that Europe “has taken tremendous vant of United States.”

France’s finance and ecomy minister, Bru Le Maire, will make ar attempt to soften tariff blow when he meets with U.S. tre negotiator Robert Lighthizer in Washington on Thursday. Le Maire told Europe 1 rio he will warn Lighthizer that Europeans would strike back if tariffs take effect on Friday.

“We, Europeans, will take similar sanctions in a few months, maybe even harsher ones - within framework of WTO - to retaliate to se US sanctions,” he said.

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Parker reported from Paris. Daniel Cole in Marseille, France, and Joyce M. Rosenberg in New York contributed to this report.