Shares in Diageo climbed nearly 2% on Friday after Donald Trump announced he would remove tariffs on whisky imports following a visit to the White House by King Charles and Queen Camilla.
The president posted on Truth Social: "In Honor of the King and Queen of the United Kingdom, who have just left the White House, soon headed back to their wonderful Country, I will be removing the Tariffs and Restrictions on Whiskey having to do with Scotland’s ability to work with the Commonwealth of Kentucky on Whiskey and Bourbon," and added that the royals "got me to do something nobody else was able to do, without hardly even asking."
The Scotch whisky sector has been under pressure from elevated levies and from declining alcohol consumption. The Scotch Whisky Association has estimated that the additional charges have cost the industry roughly A34 million a week.
Diageo, the owner of spirit labels including Johnnie Walker, Talisker and Lagavulin, said last year it would reduce production at some distilleries as a response to softer demand.
Trade arrangements between the United States and the United Kingdom were modified in 2025, leaving a 10% baseline tariff on most British goods, including whisky - a reduction from an earlier, higher rate of 27.5% that had been announced previously.
Market context
The one-day move in Diageo's stock followed a policy announcement posted to a social platform, tying a diplomatic visit to potential trade changes. The Scotch whisky industry has cited the combination of added levies and lower consumption as squeezing margins and volumes. Diageo's prior decision to cut output at certain distilleries was framed as a direct response to weaker market demand.
Implications for sectors
- Spirits sector - tariff changes and consumption trends affect revenue and production planning.
- Trade - tariff levels stemming from U.S.-U.K. arrangements shape cross-border flows of whisky and related goods.
- Consumer goods - shifting demand patterns for alcohol influence producers' capacity decisions.
Key details to note
- Trump's announcement was made on Truth Social and linked to a White House engagement with King Charles and Queen Camilla.
- The Scotch Whisky Association put a weekly cost figure on the levies at A34 million a week.
- A 2025 U.S.-U.K. trade deal retained a 10% baseline tariff on most British goods, down from a previously announced 27.5% rate.
This report reflects the facts and statements as presented, without additional interpretation beyond the information provided.