Aluminum tariffs hit craft beer brewers at Denver’s Beer Fest

Global Business

It’s been called America’s Oktoberfest. Each year, some 60,000 people descend on a Denver convention hall to rekindle their love of craft beer.

CGTN’s Hendrik Sybrandy reports.


“Every year we go with the same group of guys, every year,” said one participant. “We like it. We get to meet great people. Everybody’s cool. There’s no issues. It’s fun. It’s fun.”

800 breweries poured more than 4,000 different beers over the span of three days.

For brewers like Kevin Hopkins of Mother Earth Brewing, the joy of this event is accompanied by the sober realization that craft beer’s enormous growth of recent years is over. Sales have plateaued. There’s more competition than ever. And now, the continued pressure of tariffs.

“They are now telling us as manufacturers that we’re going to have to get ready for some increases. So we know it’s coming but it hasn’t hit us hard as of yet,” said Hopkins.

The cost of imported aluminum which is used to can beer, was slapped with a 10 percent tariff by the U.S. in March of last year. Many brewers have now been told the price of aluminum could go up by 6-14 percent soon.

“It’s a cost can-makers almost can’t avoid. They’ve relied for years on Chinese aluminum exports – which totaled 3 billion dollars in all last year. Finding an economical alternate source – can be very hard to do,” he added

“China has this huge capacity for steel and aluminum. It’s not like you can just pick up today and find a hundred billion cans worth of aluminum in Vietnam tomorrow,” said Zac Rogers from the Colorado State University College of Business.

Then there’s the beer Lefthand Brewing’s Chris Lennert once drank on the Great Wall of China and has been steadily exporting there. China imposed tariffs on his products too.

“Tariffs are 30, 35 percent now, where a year ago, they were zero. So American beers are having a very difficult time in China,” said Lennert, “a year ago, we were in a great spot. Today it’s definitely affected our business.”

On top of that, a U.S. federal excise tax break brewers have enjoyed is set to expire at the end of the year. In all, an uncertain environment for folks like Hopkins, who’s mostly held off on raising the price of his beer and believes being strategic, innovative and cautious is key.

“There’s no crash and burn. We’re just going to keep ongoing. And we’ll adjust accordingly,” added Hopkins.

Supply chain expert Zac Rogers said brewers face challenges: “They have a lot of pressures on them from a lot of different directions.”

Meantime, Beer drinkers felt no pressure at this event.

“They don’t know, they don’t care. Nor should they,” said Hopkins.

Craft beer, now up to 13 percent of the U.S. beer market by volume, remains worthy of celebration.