Europe's specialty food makers brace for tariffs

MILAN -- European producers of specialty agricultural products such as French wine, Italian Parmesan and Spanish olives are facing a U.S. tariff hike due today with a mix of trepidation and indignation at being dragged into a trade war they feel they have little to do with.

The tariffs on $7.5 billion worth of European goods were approved by the World Trade Organization as compensation for illegal EU subsidies to plane maker Airbus.

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

"It's a nightmare," said Aurelie Bertin, who runs the 700-year-old winery Chateau Sainte-Roseline in southern France. "We don't know what will be the result."

Her rose wine business has boomed in recent years thanks to American demand for the beverage. She fears her U.S. sales could drop by a third under the new tariffs.

The punitive taxes take particular aim at European agricultural products with a "protected name status." Those are goods sold under a name -- such as Scotch whisky or Manchego cheese -- only if they are from a particular region and follow specific production methods. The result is they fetch premium prices, protect cultural heritage and are shielded from competitors.

U.S.-made Parmesan cheese, for example, is not allowed access to the European market as a copycat of the traditional Parmigiano Reggiano and Grana Padano, a barrier the U.S. milk producers lobby is pressuring to bring down.

Italian President Sergio Mattarella sought to impress on U.S. President Donald Trump during a White House visit Wednesday the taxes may result in a "mere race between tariffs" after the WTO decides Europe's case later this year over U.S. subsidies to Boeing. Trump was undeterred.

European producers feel they are collateral damage from a political squabble entirely unrelated to their business.

"We consider that we are hostages 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.

The president of the Parmigiano Reggiano cheese consortium, Nicola Bertinelli, said its members "are embittered because one of the strongest sectors of our economy is being unjustly hit." He noted Italy doesn't even participate in the Airbus consortium of countries prompting the penalties.

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