Brewers fear job losses over introduction of aluminium tariff
Within hours of President Trump announcing a plan to put a ten percent tariff on imported aluminium, the Big Brewers in the US through their lobby group, the Beer Institute, responded, saying that the tariff could cost the beer industry 20,000 jobs.
“I saw a report earlier today upwards of 140,000 jobs could be lost in this country. We think the estimate for beer is about 20,000, that’s brewers, brewery workers, waitresses, bartenders [and] truck drivers,” Jim McGreevy, CEO of the Beer Institute told media on 2 March 2018.
Brewer MillerCoors lashed out against the tariff, saying they were “disappointed with [Mr] Trump’s announcement” and that if the tax were put into place, it could “lead to job losses across the beer industry.” In addition to the aluminium tariff, President Trump has proposed a 25 percent tariff on imported steel.
Under the President’s new law, signed on 8 March 2018, aluminium produced in the US would not be subject to the tariff, but America imports most of this metal. In 2016, 52 percent of aluminium for domestic consumption was imported, up from eleven percent in 2012, according to US statistics. Incidentally, Canada is the leading source and will be exempted from the tariff.
About 60 percent of the beer produced in the US (that’s nearly 120 million hl) is sold in cans. This is partially due to the fact that cans are cheaper and easier to ship than bottles.
In actual costs, the tariff will only amount to USD 0.01 per can, which is not a lot. But it still adds up. Oskar Blues, the first US craft brewer to package in cans in 2002, estimates its aluminium costs will rise by an extra USD 400,000 a year, a “significant amount” coming at a “tough time.” Competition is fierce right now, which prevents price hikes, plus hops are more expensive, and unlike the Big Brewers, craft brewers cannot absorb costlier goods as easily.
The Beer Institute contends that Mr Trump’s tariff is effectively a USD 347 million-a-year tax that will “lead to higher prices for America’s brewers and beer importers.”
