“It’s like the perfect storm and most brewers are now working hand to mouth.” – Luke Harford / Beer Canada

When President Trump recently imposed tariffs on aluminum and steel it was widely expected that they would lead to immediate price hikes on aluminum and steel in the states. What surprised was that they are leading to problems for Canadian craft brewers as well.

Here’s the deal…

One June 1st the US government imposed a 10% tariff on steel and aluminum imports. And Canada, who import the majority of raw aluminum used to produce beer cans in the US, instituted retaliatory import duties on the United States.

And although “Canada is the world’s third biggest aluminum producer and cans are made in the country, beer makers also rely on the import of more than 2 billion cans annually, largely from the United States,” according to Business Insider.

So when Canada imposed its own retaliatory tariff on aluminum imports on July 1st, the country included cans which tightened the amount of cans available to Canadian craft breweries leading to increased prices no matter where the cans came from.

And when you add in the a temporary shutdown of Massachusetts-based Crown Holdings, who along with Ball Corp, is a major supplier of cans to Canada, you’ve a perfect storm for shortages…

Steve Beauchesne, Co-founder and CEO of Beau’s Brewing in Ottawa explained his growing difficulties to Reuters …

“It seems like no one has cans to sell….Whether it’s tariff-related or not, clearly some large producers have greatly underestimated their demand so that the suppliers were caught off guard and unable to provide it”

Beauchesne expects his supply of cans to run out by mid-August with another delivery not expected until September at the earliest.”

According to Luke Harford. President of the of trade association Beer Canada, “more than 60 percent of Canadian packaged beer sales are now canned.”

And speaking with Reuters he estimated that the “10 percent tariff on aluminum beer cans will cost the Canadian brewing industry $8 million in 2018 if it stays in place.”