admin US President Donald Trump’s plan to impose sweeping metal tariffs is causing both concern and opportunity in the can manufacturing and packaging industry, which depends heavily on imported raw materials.
The 25 per cent tax on aluminium and steel entering the US from 12 March, along with potential retaliatory tariffs, is expected to drive up costs for consumers of beer, soup, and other canned goods.
“It’s just another blow the industry can’t afford,” said CJ Hélie, president of Beer Canada. “The scale and timing couldn’t be worse.”
Although nearly 90 per cent of beer consumed in Canada is brewed domestically, most of the cans—including the popular 473-millilitre size favoured by craft breweries—are imported, Hélie noted.
US can manufacturers rely on Canadian metal, which accounts for about 70 per cent of a can’s cost. Tariffs would increase the price of these imports, making cans more expensive for US producers and, in turn, raising costs when they are sold back to Canadian companies.
If Canada retaliates with its own tariffs, goods could be taxed twice.
“We’re still in an affordability crisis, and everyone is feeling it,” Hélie said. “If these tariffs and potential countermeasures come into play, brewers will face some tough choices.”
The industry now faces aluminium tariffs significantly higher than the 10 per cent imposed during Trump’s last term. While the tax may only add a few cents per can, the cumulative cost will be in the hundreds of millions of dollars, Hélie warned.
The impact is even greater given the shift from glass bottles to cans, which accounted for 75 per cent of beer sales in 2023, up from 53 per cent in 2015, according to the trade association.
Although previous tariff threats spurred some domestic can production, increasing capacity remains challenging due to high costs and the integrated nature of the US-Canada supply chain, Hélie explained.
Some businesses, however, see an opportunity.
Erick Vachon co-founded Ideal Can in 2020 and now runs what he says is Canada’s only food can producer. His company also manufactures a variety of other cans, with three production lines churning out about 1,000 cans per minute.
Expecting higher demand for locally made cans, Vachon is expanding operations by adding another shift.
“The tariff is bad for Canadians,” he said. “So I need to run three shifts a week, and we’re looking to expand the factory’s capacity.”
However, Ideal Can’s output—around 400,000 cans a year—is a drop in the ocean compared to Canada’s annual consumption of roughly 1.8 billion cans.
The overall market affected by these tariffs is even larger. The US-based Can Manufacturers Institute reported that 25 billion cans were produced for human and pet food in 2023 for the US and Canada, along with some 103 billion beer and soda cans.
The trade association has urged Trump to exempt tin mill steel from the tariffs, arguing that his last round of import taxes backfired, forcing US producers to shut down nine mill lines.
Meanwhile, businesses are still assessing the impact, particularly with Canada’s potential countermeasures remaining uncertain.
“We don’t yet have clear guidance on how this will be taxed,” said Maresh Singh, co-owner of Canadian Canning in Hamilton, Ontario. “There’s a lot of uncertainty right now.”
Singh’s company conducts about 80 per cent of its business in the US and sources cans from manufacturers in Canada, the US, and Mexico, highlighting the industry’s deep integration across borders.
What is certain, Singh said, is that prices will rise.
“The cost of products will go up for Americans—that’s a fact.”
While he hopes for more clarity in the coming days, one lesson is already clear to him: Canada must strengthen its domestic supply chain.
“Canada should increase production here at home to protect itself from such threats.”
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