Craft breweries in N.L. are eyeing the price of aluminum as the tariff war drags on
Landwash and Iron Rock say they haven’t seen a price shock just yet
Craft breweries from one end of Newfoundland all the way to Labrador are bracing for the trickle-down effects of the trade war — and keeping a close eye on their stock of aluminum cans.
Earlier this month U.S. President Donald Trump imposed a 25 per cent tariff on Canadian metal products, including aluminum. In response, on March 13, the Canadian government hit back with retaliatory tariffs.
"We rely on being able to purchase cans at a fairly standard price for our planning, for our yearly budget," Landwash Brewery general manager Christina Coady told CBC News.
"Now we may be faced with a rise in can cost shortages across the board, and it's pretty scary."
So far, the Mount Pearl brewery hasn't seen the financial impact of those tariffs, she said, adding her can suppliers have been working behind the scenes negotiating with manufacturers to try to maintain a steady supply at a stable price.
Steady as a rock
Iron Rock Brewing Co. business manager Brian Hurley said his Labrador City-based brewery sources cans from suppliers in Quebec and Ontario, and he's seen an incremental price increase between two to five per cent in recent months.
"We're anticipating some price increases coming down the line, but it's just the uncertainty that's really driven a lot of people recently," said Hurley.
There are a few things operators can do, he said, like finding alternative suppliers in Asia, but he said that can require large orders that have the potential to run into defects.
"We haven't been forced to make that pivot," he said.
Bulk buying
Coady said some breweries will buy up cans in bulk in anticipation for a price spike.
"That's where we get a little nervous that we might see some shortages down the line but for now, everything has been stable," she said.
Coady said Landwash doesn't have the space to stock up: instead, they order a truckload of 25 pallets as cans are needed.
Hurley said he and his brother, co-owner Dave Hurley, considered stocking up on cans in January, but they weren't in a position to make such a big order.
"If you're worried about payroll next week, it's hard to really have an interprovincial sales strategy or really try to stock up on inventory," he said.
Price adjustments
Hurley said the Newfoundland and Labrador Liquor Corporation allows producers to adjust prices throughout the year, and it's something Iron Rock had to request back in February for this April.
That means they were making the decision about prices ahead of knowing what tariffs might be coming into effect or how it could impact Iron Rock, he added.
"At the end of the day, a lot of business decisions are gambles, hoping that our customers will support us and understand what we're going through," said Hurley.
Coady said they're allowed a 1.15 per cent increase through the NLC, which amounts to approximately five cents extra on a canned product for the consumer.
"With such a small increase like that, we do take it just so we can keep up with our rising costs," she said.
Both Hurley and Coady say hope the new buy local campaign will help their breweries.
"When you support a local craft brewery, you're also supporting all the local industries that build up the craft brewery," she said.
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