As St. Patrick’s Day approaches, many are preparing to raise a glass in celebration. However, the mood in the craft beer industry is anything but festive. The ongoing trade tariffs implemented during President Trump’s administration are significantly impacting local breweries, making it difficult for them to sustain their operations without passing on higher costs to consumers.

Local Brewery’s Concerns

At Alameda Brewing, a microbrewery in the Bay Area, co-owner Vincent Phua expressed concerns about the economic implications of these tariffs. Despite the holiday’s beer-centric theme, Phua feels like a “pawn in a game of chess over tariffs.”

“It definitely concerns us,” Phua said. “We’re going to find out in about two to three months how much of it’s going to be passed down to us. We’re fully anticipating it. I think we are a little bit more vulnerable than, say, some of the bigger companies.”

For small breweries, the implications of purchasing aluminum cans from Canada and the anticipated rise in costs for malted barley present significant challenges. Phua predicts a price increase of approximately 20% over the next few months, with some beer styles possibly seeing costs rise by as much as 80% due to these raw material hikes.

Investing in Growth Despite Uncertainty

Alameda Brewing opened its doors in 2015 amidst a flourishing craft beer scene. While growth in the industry has slowed, Phua is committed to ensuring their brewery’s future through expansion. This expansion necessitates the purchase of larger stainless steel fermentation tanks that they currently import from China, which also face tariff increases.

“These are the ones we bring in from China. So, we are going to anticipate tariffs on those. I think it’s 20% more expensive right now,” Phua noted, emphasizing the financial burden of such capital expenditures.

Faced with uncertainty over how tariffs may escalate further, Phua emphasizes the importance of making prompt investments. “I’d rather make the purchase now before it’s too late,” he stated.

Industry Woes Reflect Broader Concerns

Head brewer Justin Green expressed frustration over the lack of stability in tariff rates, noting the chaotic nature of the trade policy changes. “I mean, first it was 25%, then it was going to go to 50%, then it went down to 25 again, then it was going to go up to 200! Now it’s back down to 20. So, we have no idea,” said Green.

This uncertainty leaves many brewers, including those at Alameda, with a sense of apprehension regarding their financial planning.

A Commitment to Perseverance

Despite the challenges presented by tariffs, the Phua family remains dedicated to their brewery dreams. Bill Phua emphasizes the importance of resilience. “I’m living my dream now,” Bill stated. “Whatever comes, we’ll deal with it. It’s nothing that’s going to stop us from manufacturing beer!”

While tariffs are intended to benefit American grain farmers, many are surprised to see that a considerable amount of malted barley is being exported to foreign beer producers, illustrating the complexities of the trade war.