Everyone in the beer industry is barking about aluminum tariffs. Yes, they suck most convincingly (agreed), but let’s not forget about the increasing suckdom of all these tariffs — solar panels, washing machines (WTF?) and steel. Both steel and aluminum tariffs go into effect this Friday, March 23, but the ripple effects are already being felt in the American beer sector. America’s last standing stainless steel beer keg maker (American Keg) is laying off about a third of its employees.
In a fun twist, American Keg doesn’t even use foreign steel. It sources domestic steel for its kegs, but American steel makers have raised prices in anticipation of the tariffs — thus fucking over folks like American Keg who run on pretty narrow margins. From the Wall Street Journal:
Since it began manufacturing kegs in 2015, the Pottstown, Pennsylvania-based American Keg has operated on a narrow margin. The 15.5-gallon keg is a staple in bars and fraternities, and the American-made version currently retails for $115 while a German or Chinese keg costs about $95. American Keg has survived by selling to craft breweries that want to support U.S. workers and American steel, even at a small premium. “But there’s a limit to what people would pay to have an American product,” says CEO Paul Czachor.
Tariffs of 25 percent on foreign steel (10 percent on foreign aluminum) are jacking up costs across the board (futures prices for U.S. Midwest domestic hot-rolled coil steel are going for $875 per short ton, up 6 percent so far in March, according to Barron’s; that’s after nearly a 13 percent jump in February). So while Trump and friends attempt to protect American steel jobs, they also put steel-dependent American business sectors in a volatile situation. For American Keg, that means 10 out of its 30 employees have to go find new jobs. Back to the WSJ:
“I had to hold back tears, and it was kind of embarrassing,” Mr. [Mark] Foster [55, among those who lost a job] told us in an interview this week. “I took it hard. I really took it hard. American Keg was my ticket. I was making my own money. It was a place where I could get my independence. Now that’s blown. It’s just a real hardship because where before, the money was coming in, and there was more food in the refrigerator, now my wife and I are trying to get the government to give us food stamps until work picks up. Why would you do that, Mr. President, when we would rather work than be on welfare?”
Brutal.
