Trump’s tariffs could make local beers pricier and jeopardize job growth
Mar 9, 2018, 9:08 AM
"Business cannot thrive in an uncertain environment," said Fremont's founder and owner Matt Lincecum.
Tens of thousands of brightly-colored aluminum cans slide, spin, and splash as workers load them onto whirring machines filling them with foamy craft beer before they’re capped and stacked into cases and stored in warehouses soaring two-stories high.
Lawmakers pass police deadly use-of-force bill and initiative
The Fremont Brewing Company’s Ballard plant will fill 17 million cans of its various brews to its loyal fans along the West Coast, but the fast-growing brewer is bracing for a chilling effect from President Donald Trump’s tariff on aluminum and steel.
“Business cannot thrive in an uncertain environment,” said Fremont’s founder and owner Matt Lincecum, surrounded by tanks and cans made of the very metals he believes could be made much more expensive as a result of the tariffs.
“Nobody knows what the price increase could be,” he said. “This creates uncertainty, and in business, uncertainty is the thing that kills you.”
Lincecum said his company puts an enormous value on buying local and sustainable materials — from malt to giant metal tanks. He plans to add more 7,200-gallon stainless steel tanks – all manufactured in the U.S. — to his brewery, to keep up with demand. But he says much of the steel American companies use may currently come from overseas to make it affordable.
“It could be from India, it could be from China, it could be from Indonesia, it’s just based on commodity pricing and we get affected by that,” he said.
Lincecum said the price of the raw aluminum which becomes a can is based on a world market for metals, and that includes every country that manufactures aluminum. He calculated that a single penny increase in the cost of aluminum would pass from a can’s original manufacturer in Olympia to the Fremont Brewery, where that penny would be magnified to an extra cost of $170,000 per year.
“We’re left with the big question mark,” he said. “It’s hard to make investments in our employees, their health care and our growth with uncertainty because we don’t know.”
“I have an economics degree,” Lincecum said. “And while I’m certainly not the president, I do know how tariffs work. We’re dealing with a world market. (Trump’s) idea is bound to hurt the same workers he’s intending to help. This process should have involved hearing from labor and from manufacturing.”
