Beer companies are reeling after President Donald Trump ordered a 25% tariff on all canned beer imports after adding it as a “derivative product of aluminum.” Experts say the tariffs will hit the beer industry hard and are urging government officials to negotiate a better trade deal.

Beer has been added to Annex 1 on aluminum derivative products facing a 25% tariff. The newly announced duties cover imports from any country.

The new levies are particularly concerning to Europe’s thousands of breweries, according to the Brewers of Europe. Breweries are still trying to figure out exactly which products will be affected by the 25% tariffs, while beer companies are scrambling to implement contingency plans.

“The US is European brewers’ second most important export market for beer in both value and volume terms. We are currently seeking further clarity on the exact products captured by this new announcement. Brewing is a key driver of growth, investment, and employment on both sides of the Atlantic and a major part of people’s lives on both continents,” says a statement from the Brewers of Europe. 

Trump’s “beer can tax” bad for business

European beer brands are popular in the US. Belgium is Europe’s largest beer exporter, followed by Germany and the Netherlands. 

Previously the import tax on European beer into the US was 5%. 

The US is European brewers’ second most important export market for beer in both value and volume terms.

Last year, European beer exports to the US were around €1.1 billion (US$1.2 billion), with Guinness and Heineken among the bestsellers. Approximately one-fifth of that trade, by value, was shipped in cans.

Constellation Brands is one of the leading importers of Mexican beer, like Corona and Modelo, to the US. Modelo is known to be mainly exported in cans. Constellation Brands is due to report financial results for its full fiscal year and fourth quarter tomorrow (April 9). 

Market turbulence

There has been increasing economic turbulence in the global financial sector as stocks dropped following Trump’s “Liberation Day” announcement last week. The tariffs continue to have ripple effects as many sectors across F&B try to mitigate rising costs and avoid escalating a trade war. 

Chief executive of the UK’s organization representing brewers and pubs, BBPA, Emma McClarkin, says: “British beer is renowned globally, and the US is one of the most important markets for British brewers, who, in 2024 exported £126 million (US$161 million) of beer across the Atlantic.” 

“A 25% tariff on beer imported into the US is a direct hit to the brewers of the UK, who contribute so much to this country’s economy and heritage. We urge the Government to defend the great British brewing industry and strike a deal which removes these harmful tariffs.”  

“With the enormous cost of doing business, many British brewers won’t be able to sustain a hit such as this from one of our biggest trading partners,” she warns.

With tariffs pushing up the cost of cans, glass bottles are suddenly predicted to be in high demand. 

Rolling back tariffs on bourbon?

Meanwhile, the European Commission is planning to propose counter-tariffs of 25% on a range of US goods in response to President Trump’s tariffs on steel and aluminum. Reports are emerging ahead of a meeting tomorrow wher member states are due to vote on proposals to add tariffs to a range of products, including eggs, poultry, and sausages. There will also be counter-tariffs on almonds and soybeans that will take effect later this year. 

The Commission had originally included bourbon, wine and dairy on the list of counter tariffs but has pulled back after President Trump threatened a 200% counter-tariff on EU alcoholic drinks if they went ahead with the 50% tariff on bourbon. 

France and Italy were particularly concerned over tariffs owing to their significant wine industries.

EU ministers are understood to be prioritizing negotiations over retaliation during tomorrow’s meeting.