Trump tariffs cause sleepless nights for the food & beverage industry! How will they manage the rising costs?

Donald Trump's 25 per cent tariff on imported aluminium and steel has left many domestic industries worried about price hikes of end products, including the food retail industry, as it is one of the largest consumers of these metals, relying heavily on imports. The local and small companies of soft drinks, beer, and pre-packaged foods are bracing for price rises. Although breweries have yet to receive feedback from can manufacturers on how they expect the tariff to impact aluminium can pricing, they hope for no positive effects.

"If everything goes up [to] 25 per cent, that's all the margin for a small business," said Matt Malloy, co-founder of Dorchester Brewing. "It becomes a push, and then it becomes not worth it any longer."

Two weeks earlier, a giant like Coca-Cola also warned of raising its aluminium-packaged products' prices to offset the tariff's impact or shifting to use plastics for its beverages.

A brief overview of the US aluminium beverage can market

Before going further into the possible impacts of the US tariff on the food retail sector, focusing on the brewery industry, here is a brief overview of the US aluminium beverage can market. The aluminium beverage cans market in the United States generates more than $12 billion in revenue. In the whole of North America, the aluminium cans market was valued at $16.4 billion and is poised to grow at a CAGR of 3.3 per cent through 2032, reaching $22 billion. The usage of cans is expected to reach 173 billion units by 2030, driven by the packaging sector for processed and ready-to-eat food products, aerated drinks, fruit juices, and energy drinks. The current domestic production of aluminium cans is roughly 115 billion units.