Phillips Distilling Moves Sour Puss Production to Canada Amid US Tariff Dispute

Phillips Distilling, a family-owned company from Minnesota, has commenced production of its Sour Puss liqueur in Montreal, Canada. This strategic relocation comes after most Canadian provinces ceased selling American-made liquor, a retaliatory measure against US tariffs imposed by President Donald Trump.

The boycott, which began in March of last year with Ontario and subsequently spread to Quebec and British Columbia, resulted in a 70% loss of Phillips Distilling's Canadian business. CEO Andy England described the impact as "a disaster," noting that Canada represents the largest market for Sour Puss. The decision to move production north of the border, a first for the company, has allowed their products to return to shelves across Canada.

Trade Disputes Persist

Despite this localised resolution for Phillips Distilling, the broader trade dispute between Canada and the US remains unresolved. The US has criticised Canada's liquor sales ban, while Prime Minister Mark Carney has indicated provinces might resume sales if tariffs on key Canadian sectors such as automotives, metals, and lumber are reduced or lifted.

Currently, only Alberta and Saskatchewan continue to sell American alcohol, as these provinces operate fully privatised liquor retail systems. Other provinces, where government boards control alcohol imports and sales, maintain the ban. The previous federal government under Justin Trudeau had also imposed tariffs on US bourbon during Trump's first term, which were lifted after a deal was reached. However, the current dispute shows no signs of an imminent resolution, prompting companies like Phillips Distilling to re-evaluate their long-term operational strategies.