In light of the Commerce Department submitting to the White House the results of its 232 investigation examining the national security impacts of aluminum imports, CEOs from some of America’s leading food and beverage companies and trade associations joined the American Beverage Association, Beer Institute, and Can Manufacturers Institute today in sending a letter to President Donald J. Trump requesting that he refrain from imposing tariffs or import restrictions on cansheet, primary aluminum, and scrap.
The letter notes a 10 percent tariff on aluminum would cost beer and beverage producers $256.3 million, a 20 percent tariff would cost $512.5 million, and a 30 percent tariff would run $768.8 million.
“Imposing an artificial price hike on American companies that employ millions of people will weaken the economy and hurt working families by raising prices, costing jobs and reducing incomes unfairly,” says Susan K. Neely, American Beverage Association President and CEO. “Tariffs on our companies’ imports of primary and cansheet aluminum will greatly increase our manufacturing costs and harm many more workers than it helps.”
“Imports of primary aluminum and cansheet used to manufacture beer cans do not threaten national security,” says Jim McGreevy, Beer Institute President and CEO. “Aluminum is critical to the beer industry and its employees, since more than half of the beer produced annually are packaged in aluminum cans or aluminum bottles. Any trade restriction on primary aluminum or cansheet imports would disrupt the market and increase costs to brewers and beer importers as aluminum customers.”
“The administration should take into consideration the unintended consequence of a trade action against aluminum cansheet and primary aluminum that would ripple across the supply chain. Like most industries, can makers depend on predictability in supply and price. If the aluminum supply is hindered by unnecessary tariffs or trade restrictions, it could lead to supply inefficacies and affect product availability,” says Robert Budway, Can Manufacturers Institute President. “Even a small tariff will result in greater uncertainty about prices, supply, financing and would dramatically curtail investment and hiring in the United States.”
Facts about the economic contribution of the aluminum, beer, and beverage industries:
The importation of aluminum is a critically important to American consumers. The aluminum can industry produces 96 billion food, beverage, and aerosol containers, employing more than 11,000 American workers in 164 plants in 33 states, Puerto Rico, and American Samoa. In total, the aluminum can industry generates $13.3 billion in economic activity.
In addition, the beer industry supports more than 2.2 million American jobs, generating more than $350 billion annually in economic output. In 2016, 56 percent of the beer produced in the United States was packed in aluminum cans or aluminum bottles.
The non-alcoholic beverage industry accounts for nearly 240,000 direct industry jobs, and another 788,000 jobs in grocery, retail, and other industries that depend on beverage sales. The industry has a $166.5 billion direct economic impact, $21.1 billion of which is wages paid to American workers.
Facts about U.S. aluminum imports:
The United States has been in a deficit position with respect to primary aluminum since the end of World War II. In fact, imports of aluminum to the U.S. have increased as production within the U.S. has decreased.
Canada is the leading source of U.S. aluminum imports, accounting for 66 percent of total unmanufactured aluminum imports in 2015; no other nation accounts for more than 10 percent of total unmanufactured aluminum imports.
Facts about the U.S. Department of Commerce’s 232 investigation on the effect of aluminum imports on U.S. national security:
On April 27, 2017, citing Section 232 of the Trade Expansion Act of 1962, President Trump sent a memorandum to the U.S. Commerce Department directing them to investigate whether aluminum imports are jeopardizing U.S. national security.
On Friday, January 19, 2018, Secretary Ross formally submitted to President Trump the results of the Department’s investigation into the effect of wrought and unwrought aluminum imports on U.S. national security. The President now has until April 20, 2018, to decide on any potential action based on the findings of the investigation.
The companies and trade association that signed the letter include:
American Beverage Association
Ardagh Group
Ball Corporation
Beer Institute
Brewers Association
Can Manufacturers Institute
The Coca-Cola Company
Constellation Brands Beer Division
Crown Holdings
Dr Pepper Snapple Group
HEINEKEN USA
Molson Coors Brewing Company
National Association of Beverage Importers
National Beer Wholesalers Association
PepsiCo North America
Rogue Ales
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