Tariffs on aluminium could lift prices of canned beer and vegetables in the U.S.

U.S. consumers could end up paying more for a six pack of beer or a can of vegetables if President Donald Trump takes actions on U.S. Commerce Department’s tariff recommendations on steel and aluminium imports.

Critics are of the view that such protective actions may harm many U.S. end-user industries, including breweries and canned vegetable companies that use imported aluminium for product containers.

“Anything that raises our raw material costs will affect the bottom line,” said Henry Schwartz, founder and CEO of MobCraft Beer, a Milwaukee brewery.

Switching off again to glass bottles again would cost money on additional equipment and bottles are not as appealing to consumers as cans.

According to industry statistics, for every dollar worth of beer produced in the U.S., brewers spend about a dime for cans and roughly five cents for aluminium. The amount adds up huge when one considers more than $55 billion worth of beer produced annually.

According to the Beer Institute at Washington, D.C., Just a 10% tariff on aluminium would cost beer and beverage producers $256.3 million. More than 50% of the beer produced in the U.S. is packaged in aluminium cans or bottles said Jim McGreevy, president of the industry trade group. The extra cost on can sheets would be passed along to consumers.

“Imposing an artificial price hike on American companies that employ millions of people will weaken the economy and hurt working families,” Susan Neely, president and CEO of the American Beverage Association, said in a statement. He believes tariffs will increase manufacturing costs and do more harm than helps.

The beer makers and can manufacturers are of the view that aluminium they use should be removed from the proposed tariffs and quotas as they pose no national security threat.

Wisconsin, one of the nation’s leading producers of canned vegetables, import a substantial amount of steel and aluminium and is worried about the cost hike.

“We are right with the aluminium (bottle and can) guys on this and are very concerned,” said Nick George, president of the Midwest Food Processors Association, based in Madison.

Critics fear that other countries will also start using national security as a pretext to impose trade restrictions. They also worry that tariffs would reduce overseas competition that helps keep metal prices in check.