The Bitter Taste of Tariffs: What's Brewing for Your Favorite Craft Beer?

Throughout this blog, you’ll notice numbers in the text that correspond to detailed sources and citations listed at the end, ensuring you have accurate and reliable information on the impact of tariffs on craft beer.

So, you like kicking back with a cold one from your local craft brewery, huh? Well, grab another because things are about to get a little… bubbly. Not in a good way, unfortunately. Uncle Sam has decided to shake things up with some new tariffs, and guess who's feeling the pinch? Our beloved small craft breweries. Let's dive into this frothy mess and see what it all means for your next pint.

The Tariff Tango: A Quick Step-by-Step

Think of tariffs like extra charges on stuff coming into the good ol' US of A. Now, there's a whole bunch of new ones, but a few are really going to make our brewers sweat. We're talking about a universal 10% tariff on almost everything (1), plus some extra hefty "reciprocal" tariffs on countries we have a trade beef with.(1) But wait, there's more! We've also slapped a 25% tariff on all imported steel and aluminum (1), and since Canada and Mexico are big players in our beer world, the 25% tariff on most of their imports is also causing a stir.(1) Even China, while not a huge source of brewing ingredients, is facing increased tariffs that could affect equipment costs.(1) It's like a tariff party, and nobody brought the good chips.

About 75% of craft beer is now sold in aluminum cans, and the new 25% tariff on imported aluminum and empty cans could add an estimated $60 million to the cost for small brewers nationwide.

The Costly Ingredients: From Can to Keg

What does this tariff fiesta mean for your beer? Well, imagine trying to bake a cake when the price of flour, sugar, and even the baking pan suddenly jumps. That's kind of what's happening to our brewers.

First up, the humble aluminum can. Craft beer and cans go together like hops and barley, with about 75% of craft beer now sold in them.(30) That shiny 25% tariff on imported aluminum (1) and imported empty cans (23) is a real gut punch. Even if the cans are made in the US, the aluminum itself might come from Canada, making it pricier.(39) Some folks are even panic-buying cans, making it even harder for the little guys to get their hands on them.(28) The Brewers Association reckons this could add a whopping $60 million to the cost of small brewers nationwide.(40) Cheers to that… not!

Then there's the barley. Our neighbors up north in Canada are big suppliers of this crucial ingredient, especially the good stuff some brewers swear by.(41) That 25% tariff on most Canadian imports 1 means the cost of that lovely malt is likely heading north too.(32)

And let's not forget the shiny toys! Brewing equipment, like those big steel fermenting tanks and kegs, often contain steel and aluminum.(12) With tariffs on both, setting up a new brewery or expanding an existing one just got a whole lot more expensive.(29)

Will My Pint Cost More? Spoiler Alert: Probably.

So, what happens when the cost of everything goes up? Breweries have a tough choice. They can try to eat the extra cost, which squeezes their already thin profit margins.(31) Or, they might have to pass some of that cost onto you, the thirsty consumer.(28) Some brewers are already bracing for having to raise prices by at least a dollar per six-pack.(29) Nobody wants to pay more for their favorite brew, but that might just be the bitter reality we face.

Not All Beers Are Created Equal (Regionally Speaking)

The impact of these tariffs won't be the same everywhere. Breweries close to the Canadian border, for example, might feel the pinch on barley more acutely.(32) Places like Pennsylvania, which rely on both Canadian malt and imported aluminum, could be particularly vulnerable.(32) And don't forget, Canada is a big fan of our craft beer, buying almost 38% of our exports.19 If they get grumpy about our tariffs, they might retaliate, hitting our exporting breweries where it hurts.(15)

“When tariffs hit craft beer, the cost isn’t just in dollars – it’s in community, creativity, and the spirit of local brewing.”

Brewing Up Solutions: How Can Breweries Cope?

Our crafty brewers aren't just going to roll over and let the tariffs win. They're looking at ways to fight back. Some might try to source more ingredients from within the US (43), though that might be easier said than done for certain types of barley or hops.(40) Others might focus on becoming super-efficient in their operations.(27) And, as we discussed, some might have to carefully adjust their prices.(28) You might even see a shift towards more bottles instead of cans 16, though that comes with its own set of challenges.(33) Some breweries might even try to renegotiate with their suppliers.(35) It's going to be a tough balancing act.

The Big Beer Battle: Who Comes Out on Top?

These tariffs could also shake up the beer market. Imported beers, especially those in cans, might become more expensive, giving a slight edge to domestic brewers.(23) Bigger breweries with more resources might be able to weather the storm better than the smaller, independent ones.(29) So, while your local brewery might be feeling the squeeze, those mega-brewers might just keep chugging along.

“A pint may cost more, but supporting your local brewery means investing in flavor, craftsmanship, and a resilient beer community.”

The Bottom Line: Support Your Local Pint!

The next six months are going to be interesting for the craft brewing scene. These tariffs are throwing a wrench in the works, leading to higher costs and potential price hikes. While our brewers are a resilient bunch, they could really use our support. So, next time you're reaching for a beer, consider grabbing one from your local craft brewery. It might cost a little more, but you'll be helping them navigate these turbulent times and ensuring that the delicious, innovative brews keep flowing. Cheers to that!

Works cited

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