Alberta brewers concerned about cost of beer cans amid aluminum tariff war

Not even cracking open a cold one is safe from tariffs. 

As the Canada-U.S. trade war continues to dominate headlines, Alberta's beer industry is paying close attention to how this is impacting the price of metal cans.

U.S. President Donald Trump imposed a 25 per cent tariff on Canadian metal products entering the United States on Wednesday, and the Canadian government hit back with almost $30 billion worth of retaliatory tariffs that came into effect on Thursday.

Microbreweries in and around Calgary sell their products in tall, short or skinny cans, all made of aluminum. So for Calgary beer makers, the trade war means re-examining how they get cans of beer in the hands of thirsty consumers.

"Breweries all over the place are working hard to just keep their costs in line," said Chris Carroll, co-founder of Ol' Beautiful Brewing.

In 2017, the brewery started producing take-home cans of beer in its Inglewood taproom. Recently, the business expanded its sale of retail and wholesale products into a larger, off-site production facility. 

Last year alone, Ol' Beautiful sold a million cans of beer, Carroll says. 

The brewery uses short, 355-millilitre cans, which are manufactured in Calgary. Yet even the aluminum in locally made cans crosses the Canada-U.S. border at some point in its life cycle, thanks to an integrated supply chain. That means tariffs would impact the costs associated with canning Ol' Beautiful's beer. 

Carroll says Ol' Beautiful has stockpiled months worth of beer cans in response. 

"Right now, we're not feeling anything. But I'm sure when we go to reorder, the prices will have increased. We're hearing numbers about seven per cent increase on the price of an aluminum can," he said. 

Ol' Beautiful is not alone. Big Rock Brewing, Alberta's largest microbrewery, has stocked up, too.

"Typically we bring our cans in every two weeks," said Brad Goddard, vice-president of business development with the Calgary-based brewery.

"We're looking at more like two months of cans on supply right now.

Despite the upfront cost, Goddard says Big Rock needs to mitigate the tariff risk because it typically uses up to 65 million cans a year, depending on demand. 

"Years ago, well just around the pandemic, we dealt with a scarcity of cans, and that drove can cost up," he said. 

"Now we've got plenty of cans, but the can costs are going up — which is counter to what you'd normally say, 'hey, if we've got lots of cans, the price should come down.' But now government sabre-rattling is pushing the prices back up."

Even the threat of tariffs has driven up costs, says Goddard. 

"We have a contract, but the contract does foresee situations like this, tariffs coming into place, and it's also influenced by the aluminum futures market," he said. 

"So as the market gets anxious about the impact, the market goes wild and that influences our cost of materials. So we've already started feeling it."

Many breweries in Alberta use tall cans that come in 473-millilitre sizes — also known as tall boys, holding about a pint. Usually, this style of aluminum can is sourced directly from the United States.

Tool Shed Brewing, headquartered in northeast Calgary, is one of those breweries. According to founder Graham Sherman, the company projects going through about two million tall cans this year.

In order to mitigate harm from tariffs, the brewery has come up with its own work-around for importing aluminum cans. 

Tool Shed is now getting all of its tall cans from China instead of the United States — at a cheaper price. 

"We make sure with this next order that the aluminum is from China, that the cans are being manufactured in China, that when they land in North America, they land at north of the border in British Columbia and come to us without touching the United States," said Sherman. 

Each of these Alberta microbreweries say they're hoping for a quick end to the trade war.

For people like Goddard, he's worried that if the trade war continues, consumers will end up paying the price.