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Pennsylvania Breweries Face Financial Challenges from New Tariffs

Pennsylvania breweries are bracing for financial impacts due to new tariffs.

News Summary

Pennsylvania breweries are preparing for significant financial impacts due to President Trump’s upcoming 25% tariff on imported steel and aluminum, set to take effect on March 12, 2025. As costs for essential materials like aluminum cans rise, craft breweries, particularly in a state renowned for its craft beer production, are voicing concerns about sustainability. Small brewery owners worry about increased prices for consumers amid economic uncertainty. The state government is urged to consider these challenges before implementing the tariffs, as they could have far-reaching effects on local economies and the brewing industry.

Pennsylvania breweries are bracing for a significant financial impact as President Donald Trump is set to impose a 25% tariff on imported steel and aluminum starting on March 12, 2025. This policy change is expected to affect the costs of essential materials and increase overall production expenses for craft breweries across the state.

Beau Baden, the owner of Sherman Street Beer Company in Allentown, opened his brewery in 2021 and is already feeling the pinch of rising costs due to these new tariffs. He anticipates higher prices for hops, aluminum cans, and other imported goods necessary for his business operations. As his brewery gears up to celebrate its fourth anniversary in April with a large crowd, Baden’s concerns about the financial sustainability of his establishment resonate widely among small brewery owners in the region.

Baden is not alone in his worries as many brewery owners throughout Pennsylvania have come forward about their financial concerns regarding the implications of current and future tariffs on the craft beer industry. With Pennsylvania ranking second in the nation for craft beer production, boasting over 530 craft breweries, the potential for increased costs may have widespread repercussions.

Economists have warned that rising business costs resulting from tariffs could lead to higher prices for consumers across various goods, including beer. Approximately 75% of packaged craft beer in the U.S. is sold in aluminum cans, making breweries particularly vulnerable to changes in metal pricing. The situation is compounded by an ongoing trade war with China, which has escalated tariffs on Chinese goods from 104% to 125%.

Small breweries like Baden’s may struggle to absorb these rising costs, and brewery owners are increasingly uncertain about how much of these price increases consumers are willing to pay, especially amid broader economic concerns regarding a potential recession. The financial implications of these tariffs also extend to the restaurant industry. Jeff Fegley, owner of Brew Works, has voiced worries that the rising beer prices may deter consumers from spending on dining out, leading to deeper issues for overall sales in the field.

Challenges of Sourcing Materials

The packaging industry presents limited alternatives for brewers reliant on aluminum cans. As costs associated with these materials go up, local breweries may face the risk of increased operational costs translating into potential price hikes for consumers. This reality reflects a troubling trend in the brewing community, with more breweries closing than opening due to financial strain.

Statewide Support for Breweries

Governor Josh Shapiro has taken notice of the challenges faced by small businesses impacted by the tariffs, emphasizing the need to support the craft beer industry in Pennsylvania. Brewery owners are advised to exercise caution and patience in making decisions during this period of uncertainty, echoing past experiences during previous supply chain crises.

Local officials have underscored the importance of national policymakers understanding how these tariff changes affect small businesses. There are significant concerns regarding potential adverse impacts on local economies as brewery operations become more challenging under the financial strain of new tariffs. As July 2025 approaches and implementation of the tariffs looms, Pennsylvania breweries continue to prepare for a future that may alter the landscape of craft beer production in the state significantly.