Resiliency and innovation are hallmarks of the craft brewing industry. From experimenting with new ingredients to finding ways to survive in the face of prohibition, developing creative solutions to challenges is something we’ve come to expect from our favorite craft brewers. 2018 tested that resiliency, both politically and economically. Trade policy has created a shifting playing field, with tariffs threatened and enacted, and trade agreements proposed and dismantled. 2018 ended, and this year began, amidst the longest federal government shutdown in history. These unique conditions have affected—and continue to affect—most industries, and the craft beer industry is no exception. As part of an already constantly changing industry, breweries offer an informative glimpse into possible developments we might see in coming years.

Trade Policy

Changes in trade policy can have major impacts on the craft beer industry, and over the past year, they have. The 2018 tariffs the United States levied on steel and aluminum imports are a prime example—most beer is brewed in elaborate stainless steel setups, and aluminum cans have surpassed glass bottles and continue to increase in market share as retail beer vessels. The Brewers Association, a trade association for small and independent craft brewers, has expressed concern about these tariffs, citing the disproportionate effect on smaller breweries as compared to larger, more established ones. Because the steel and aluminum tariffs affect, respectively, the cost and availability of materials for producing and for distributing beer, they likely serve as a barrier to both the creation and expansion of independent breweries. At the other end of the size spectrum, multinational beverage companies have also expressed concerns that tariffs on aluminum could curtail growth and investment in product, as more operating funds will necessarily be diverted to packaging. The tariffs’ long-term effects remain to be seen, but breweries and many other businesses anticipate raising prices, slowing hiring, or both, in reaction to the increased cost of necessary raw materials.

Government Shutdown