California inks nefarious deal with Canadians to save wine industry from brink of collapse

California lawmakers are ramping up efforts to reopen Canada’s market to American wine after a trade dispute triggered a sharp decline in exports and deepened financial pressure on wineries across the state.

Nearly 18 months after Canadian provinces retaliated against President Donald Trump’s America-First trade policies by removing US alcohol from shelves, a bipartisan group of California lawmakers is urging Quebec Premier Christine Frechette to back down and restore market access for American producers.

In a letter to the premier, lawmakers argued that wineries have been caught in the middle of a broader trade fight.

“Reopening the market to American wine would restore consumer choice and signal a commitment to restoring fair and balanced trade for Quebecois consumers and American wineries who have no connection to the underlying trade disputes,” the lawmakers wrote.

“Unfortunately, the restriction on American wine has had damaging consequences for regional consumers, businesses, and producers who had no influence over national policies.”

The push comes as new data highlights the toll on the US wine industry.

According to the Wine Institute, a California winery advocacy group, exports to Canada fell dramatically in 2025, costing US wineries nearly $357 million.

The organization said the provincial bans affected nearly 95% of family-owned small- and medium-sized wineries and contributed to hundreds of layoffs.

“Full-year 2025 data now confirms this is the most catastrophic single-year trade disruption in the history of US wine exports,” the group said.

California accounts for roughly 80% of all US wine production, making the state particularly vulnerable to the loss of its largest export market.

Between 2024 and 2025, US wine exports to Canada dropped at least 78%, according to the Wine Institute.

Some producers have already scaled back operations. In 2026, Modesto-based E. & J. Gallo Winery closed parts of its business, while Ernest Vineyards in Healdsburg and Margins Wine in Watsonville shut down.

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Lawmakers are also pursuing financial relief for agricultural producers.

California Democratic Senator Adam Schiff has introduced a package of six bills aimed at expanding support and market access for California growers.

The proposals would increase funding for US Department of Agriculture programs focused on disaster prevention, recovery and agricultural research.

One measure would provide the USDA with $5 billion in economic assistance for specialty crop producers, including fruit, vegetable, tree nut and horticultural growers.

While wineries would not qualify directly, grape growers who supply wine producers could be eligible.

Schiff also joined House colleagues in a June 24 letter urging Frechette to reconsider Quebec’s restrictions.

“As a US Senator on the Senate Agriculture Committee, I have had the great fortune of spending time with and learning about the challenges and opportunities of California’s winegrowers,” Schiff wrote.

“They take great pride in their work, are essential to the state and national economy, and have brought tremendous value – in culture and in taste – to Americans and Canadians alike.”

At the state level, Assemblymembers Damon Connolly and Rhodesia Ransom introduced Assembly Bill 1585, which would require wine labeled “American” to be made from grapes grown in the United States.

Supporters said the proposal would strengthen demand for US-grown grapes, but the bill was pulled from a California Senate hearing after it became clear it lacked enough votes to advance.