Trump’s Aluminum Tariffs Drive Up Beer Prices for American Consumers

Summary

• Trump’s Tariff Move: A 25% import tariff on all aluminium products starts today.
• Beer Industry Impact: US brewers will face higher costs for aluminium cans.
• Price Hikes: American beer drinkers could see price increases.
• Global Trade Shift: Suppliers are redirecting aluminium to Europe to avoid tariffs.
• Economic Uncertainty: The US aluminium premium hits record highs.

Trump’s Aluminium Tariffs Hit American Consumers

First, some good news for US aluminium buyers—Trump has backed off from his threat to impose a 50% tariff on Canadian metal. But now the bad news: a 25% tariff is in effect, covering aluminium imports from all countries.

The policy, aimed at reviving US smelting capacity, has already sent the CME Midwest aluminium premium to record highs. This will inevitably push costs down the supply chain, impacting companies like Ford Motor (F.N), Lockheed Martin (LMT.N), and America’s independent brewers.

Tariffs Mean Higher Beer Prices for American Drinkers

Trump first imposed 10% aluminium tariffs in 2018. Within a year, the Beer Institute estimated that brewers had already incurred $250 million in extra costs.

A report from Harbor Aluminum found that out of that $250 million:

• $50 million went to the US Treasury.
• $27 million benefited domestic smelters.
• $173 million was passed down the supply chain to fabricators.

The problem? US cansheet is 70% recycled aluminium, sourced domestically. Yet brewers are still paying the full tariff as if they imported new aluminium.

The Real Beneficiaries of Trump’s Tariffs

The US aluminium industry directly employs 164,000 workers, but only 4,000 work in upstream smelting. Meanwhile, the US consumes 4.9 million tons of aluminium annually but produces only 670,000 tons.

With a heavy reliance on imports—4.0 million tons annually, 70% from Canada—it’s unlikely that domestic smelting will fully replace foreign supply anytime soon.

Even if idled US smelters restart, production would still fall short, meaning American businesses and consumers will continue to bear the brunt of tariff costs.

Trading Volatility & Global Market Shifts

On Tuesday, Trump’s tariff threats caused the CME US aluminium premium to spike to nearly $1,000 per ton. But after striking a truce with Ontario Premier Doug Ford, the premium retreated.

Yet, something unusual is happening: European aluminium premiums are falling, even though European buyers are losing Russian supply due to sanctions. This suggests that US suppliers are re-routing aluminium to Europe to avoid Trump’s tariff hikes.

For European beer drinkers, that’s good news—they may end up paying less for their aluminium cans, while Americans are left with the higher costs.

What’s Next? The Uncertain Future of US Aluminium Tariffs

Trump’s unpredictable trade policy has already caused uncertainty in global aluminium markets. If tariffs continue to rise, manufacturers and brewers may need to pass costs down to consumers, making beer, cars, and even military equipment more expensive.

As American beer drinkers brace for potential price hikes, the biggest winners might just be their European counterparts—who could soon be toasting to lower costs.