US-Canada tariff tensions drive 84% rise in aluminum prices for Texas fabricator

A Texas metal fabricator says the cost of aluminum has risen sharply as trade tensions between the US and Canada add pressure to cross-border supply chains. Lance Thrailkill, CEO of All Metals Fabricating in Allen, said the company has seen aluminum prices increase by 84% since March last year, with much of its aluminum sourced from Canada.

The higher material costs are affecting both the company’s margins and what its customers pay. Thrailkill mentioned, “Fortunately, we’re able to pass a lot of that on to our customer base, but oftentimes also we do get squeezed in terms of margin, so you might be able to maintain the same profit amount, but your margin goes down, so that is not ideal.”

Thrailkill noted that the company has had to adjust how it manages its aluminum inventory as prices continue to change. Buying additional material ahead of expected price increases can help manage costs, but it also requires more cash to hold inventory.

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“We need to be strategic and think in advance,” Thrailkill said, adding that carrying additional stock requires the company to have enough cash available.

The situation comes amid continuing tariff tensions between the US and Canada. Canada imposed new counter-tariffs on US goods from September 8, with rates of up to 50% on certain products, including aluminum and steel, matching corresponding US tariff rates.

Canada’s measures followed a US decision to impose a 50% tariff on $27.6 billion of Canadian goods effective August 22. Canada’s countermeasures include 50% tariffs on several US aluminum products.

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A similar impact is being seen in Canada’s beer industry, where higher aluminum costs have pushed up can prices. Walkerville Brewery said the cost of a 473 ml aluminum can rose from around 31 cents to 35 cents following the tariff changes. The brewery uses about 40,000 cans a month and has so far absorbed the increase, although it expects higher costs could eventually lead to price increases.

For All Metals Fabricating, the continuing uncertainty makes planning more difficult. Thrailkill said the company is trying to anticipate price movements and make purchasing decisions accordingly, while managing the cash required to maintain inventory.

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He remains hopeful that the US and Canada can reach an agreement and bring the tariff dispute to an end.

“I think the biggest thing is with uncertainty,” Thrailkill stated. “Everybody wants stability and certainty, you know, as much as we can have.”