The craft beer industry is starting to feel the effects of the months-long trade dispute between the U.S. and China, industry insiders say. And they worry the impact will only get worse as the dispute continues.
In March 2018, the Trump administration placed a 10 percent tariff on aluminum and a 25 percent tariff on steel. Since then, the costs of everything from cans to other equipment used by craft breweries have risen.
Before the tariffs, a single can cost between 15 and 18 cents. That same can is now 19 to 24 cents, brewers reported. When multiplied across the thousands of cans a brewery uses, the total can be significant.
The tariffs also are leading to jobs losses, industry insiders say, up to 40,000 of them since 2016. In an interview with foodandwine.com, Jim McGreevy, CEO of the Beer Institute, attributed the losses to the tariffs.
“While one can’t say aluminum tariffs are 100 percent to blame for the 40,000 lost jobs, as there are multiple factors, this evidence supports that brewers are making fewer investments and having to make tough decisions because of the added cost of aluminum, and that’s having an impact throughout other parts of our economy,” McGreevy told the website.
A release provided by The Brewer’s Association, a non-profit trade association of “...more than 5,240 U.S. brewery members and 46,000 members of the American Homebrewers Association,” said “The Brewers Association continues to work alongside members of Congress and our industry partners regarding tariffs. Aluminum cans represent nearly half of packaged production for small brewers, and as such, our efforts on Capitol Hill include not only educating members on the potential impact these tariffs will have on our industry but advocating for the exclusion of aluminum sheet or “cansheet” imported in the U.S.”
Brewers fear the ongoing trade war will stifle what has been a booming industry: In 2000, there were about 1,500 craft breweries in the U.S. In 2018, there were, 7,450.
Nationwide, the craft beer industry has exploded from about 1,500 breweries in 2000 to 7,450 in 2018.
“Our industry does not need more uncertainty, it needs more stability and tariffs are just another tax that make planning and investing near impossible for small and independent craft brewers across the country,” the Brewers Association said.