American brewers and beer drinkers were foaming at the mouth Thursday after President Trump proposed a tariff on aluminum imports.
The protectionist measure, geared toward helping the steel and aluminum industries, will lead to a spike in beer prices and layoffs, brewers said.
“American workers and American consumers will suffer as a result of this misguided tariff,” MillerCoors, the country’s second largest beer maker tweeted. “It is likely to lead to job losses across the beer industry.”
Trump, during a White House meeting Thursday with the country’s largest steel and aluminum manufacturers, announced that he would impose a 10% tariff on aluminum and a 25% tariff on steel to counteract a glut of foreign steel and aluminum that has flooded the market and driven down prices.
“Aluminum has been decimated in this country,” the President said. “We’re bringing it back.”
The Beer Institute, a trade association and D.C. drink tank, said the 10% hike on aluminum would cost the industry $347.7 million and more than 20,000 jobs.
The per-can price could hop from 20 cents to 24 cents.
Local breweries were also flat on the idea.
The Bronx’s Gun Hill Brewery co-owner David Lopez said the trade protection could skunk his business.
“If that drives up the cost of our cans, that would not be good for us,” he said. “It would cut into our already thin bottom line.”
The President’s tariff announcement came in response to an increase in foreign steel and aluminum, especially by China.
The Commerce Department said in a report last week that the trade imbalance could limit the military’s access to steel used for weapons and poses a national security threat.
But Canada, not China, sends the most steel into the U.S.
Politicians from the Molson-manufacturing country scoffed at the stance that it’s a national security issue.
“It is entirely inappropriate to view any trade with Canada as a national security threat to the United States. We will always stand up for Canadian workers and Canadian businesses,” said Canadian Minister of Foreign Affairs official Chrystia Freeland.
She said that Canada, which accounts for 16% of the steel imported into this country, would not stand by idly if tariffs kick in.
“Should restrictions be imposed on Canadian steel and aluminum products, Canada will take responsive measures to defend its trade interests and workers,” she said.
Wall Street didn’t like the plan, with the Dow dropping 420 points and losing 1.7% of its value. The Standard & Poor’s 500 index tumbled 36 points, or 1.3%.
Car companies also slammed the idea.
“The (U.S.) Administration’s decision to impose substantial steel and aluminum tariffs will adversely impact automakers, the automotive supplier community and consumers,” Toyota Motor Corp. said in a statement.
Housing construction may get more expensive too.
“Steel is pretty ubiquitous in construction,” Association of General Contractors chief economist Ken Simon said.
Republican congressmen from the nation’s breadbasket feared that countries would react with tariffs on U.S. wheat.
“Let’s be clear: The President is proposing a massive tax increase on American families,” Republican Sen. Ben Sasse of Nebraska said. “Protectionism is weak, not strong. You’d expect a policy this bad from a leftist administration, not a supposedly Republican one.”
U.S. wheat accounts for 74% of Canada’s imports, according to the Department of Agriculture.
Instead of across-the-board tariffs, the Commerce Department has suggested that stiffer tariffs be imposed against specific countries.
Not everyone was opposed to the plan. Support came from the steel and aluminum industry, and organized labor.
“This is a great first step toward addressing trade cheating, and we will continue to work with the administration on rewriting trade rules to benefit working people,” AFL-CIO President Richard Trumka said.
The President has until April 11 to make a decision on steel, and until April 19 to decide about aluminum.
At the Bronx Brewery in Port Morris on Thursday night, news of the protectionism was met with outrage.
“They’re only hurting Americans by raising tariffs,” Grant Kassap, 52, said as he sipped a “Slow Your Roll” Session IPA. “Who are they protecting?”
The brewery only sells its beer in kegs or in cans, never bottles.
Irv Fabor, 30, said he found a way not to support the tariff and encourage others to follow suit.
“Are we going to accept this?” he asked, raising his voice. “I’m going to drink more draft beer instead of cans.”
With News Wire Services