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Cheeses at Cured in Boulder. Photo courtesy of Cured

Front Range Businesses Brace for 25 Percent Tariff on Agricultural Goods

Restaurants and shops selling imported European foods and beverages are among the local businesses that will be affected by the tariffs—and consumers could see prices go up, as well.

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Wedges of Comté cheese, bottles of Rioja and Scotch, plates of prosciutto, jars of hot German mustard, tins of Spanish olive oil, and even wool suits from England—all are poised to leap in price across Colorado in coming weeks and months.

Starting today, the Trump administration is imposing 25 percent tariffs on a wide range of agricultural products from the European Union. The tariffs, announced earlier this month, emerged after the World Trade Organization (WTO) ruled that the EU improperly subsidized international aircraft manufacturer Airbus. The subsidies, according to the WTO, were not fair to Airbus’s biggest competitor, Seattle-based Boeing.

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The ruling let the U.S. levy $7.5 billion a year on EU products. One of the results? Heavy tariffs on a wide range of agricultural goods. “The majority of what I sell will be subject to the new tariffs,” says Zach Locke, the owner of Old World Wine Company in Denver, who importants European wine, much of it from France. “There is no way we can’t pass on the cost of the tariffs. We don’t have much margin. To lose even five or 10 percent is enough to just stop doing business.”

Locke lucked out this week, as a big shipment of wine sailed through the U.S. Customs and Border Protection agency prior to the imposition of tariffs. But he has other shipments arriving after today that will cost 25 percent more. Some of it is pre-sold to customers for the pre-tariff price. Meanwhile, he has started slashing orders. One shipment of 1,100 cases of wine was whacked in half.

Locke’s business is especially known for its Burgundy wines, which have rocketed up in price during the past decade. Among other things, the tariffs are causing Locke to reconsider his portfolio. Instead of so much Burgundy, he might start importing more wines from regions like the Loire Valley and the Jura region. “We sell great wines in those areas, which might become more appealing because they are affordable,” he says.

Just as wine importers and distributors like Locke are wrestling with tariffs, so are the people to whom they sell their wine—liquor stores and restaurants.

The tariffs will “stifle sales, 100 percent,” says Brett Zimmerman, a master sommelier and owner of Boulder Wine Merchant. “It’s really sad. A lot of us have worked hard to build these brands in the market. This chops all of that down.” Zimmerman says the tariffs may also encourage him to explore more wines from regions not subject to tariffs, such as Portugal.

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The owners of gourmet shops like Cured in Boulder and Truffle Cheese Shop in Denver are struggling to figure out how to manage inflating prices. Wine importers and shops have a little breathing room, due to existing inventory that is not perishable. But stores specializing in cheese don’t enjoy that luxury.

“Championing American products is what we have done since day one, but this doesn’t seem like the right reason to do it,” says Cured owner Will Frischkorn. “We want to celebrate American products when they are the best, not because of some silly policy.”

Frischkorn anticipates scaling back on some of his European cheeses and seeking more fine cheeses from American artisans. He is working closely with the shop’s many importers to figure out ways they can share the pain, rather than passing on the cost to consumers. Some importers are amenable, but not all.

“One of our biggest cheese distributors has already raised its prices by 25 percent, on product they already have in the warehouse,” says Frischkorn. “It was shocking. Everybody is looking for how to move their business to somebody else. They are going to lose a lot of business.”

Most of Cured’s products will get hit with tariffs, including the shop’s deep selection of olive oils. “Top olive oils are expensive,” says Frischkorn. “As customers get educated about the pleasures of great olive oil, they have been willing to pay what it costs. But 25 percent more is different.”

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One culinary product that might remain cheaper, at least for awhile, is aged cheese. The Truffle Cheese Shop has been stocking up on it since the tariffs were announced earlier this month. “They will last through the holidays unopened,” says owner Joe Schwab. Like Frischkorn, he will search for more American cheeses as the tariffs become the new reality.

But turning to American producers might not save consumers much money. With more stores switching from European to American cheese, demand will spike. And the makers of fine American cheeses can only make so much.

One potential silver lining? Prices will rise for everybody, including places like Whole Foods Market and King Soopers, says Schwab. Boosted prices at supermarkets “may persuade people to head to specialty shops more. And the supermarkets of the world may have to rethink their specialty food programs.”

Ever since the tariffs were announced, Boulder and Denver restaurateur Bobby Stuckey says he has “been living the tariff talk.” Just this week, he was collaborating with American Airlines on the in-flight wine list. They had been working on lists all year, and “all of that goes up in smoke,” says Stuckey, who leads the company’s wine program. “A lot of wines they might use from France or Spain at the lower price point just got a 25 percent hit.”

Meanwhile, Stuckey and partners are planning to open Sunday Vinyl, a wine bar, near Union Station in November. Months of work on that list has to be re-examined.

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Stuckey’s restaurants, Frasca Food & Wine in Boulder and Tavernetta in Denver, lean heavily on Italian wine, which escaped the tariffs. But Italian ingredients like prosciutto and Parmesan, which are subject to tariffs, will see price hikes beginning today. “We’ll have to address line by line what items need to be adjusted,” he says, referring to the lineup of Napoli-style pizza at his two Pizzeria Locale locations.

“We can’t just eat 25 percent in our industry. There isn’t 25 percent percent to eat,” he says. “When Trump hits the farmers, they have lobbyists. And Trump ended up giving them subsidies to help. But in this case, there are so many small businesses that are getting hammered.”

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