ROCHESTER, N.Y. — Potential tariffs from President Donald Trump on imports of some products entering the United States from the Canadian and Mexican borders are poised to potentially dampen some spirits at breweries across New York state.
“We are an American manufacturing company here,” said Three Heads Brewing President and Co-Owner Daniel Nothnagle.
Three Heads is preparing for the potential of Trump’s proposed 25% tariffs.
“Managing it will be very difficult,” he said. “These tariffs will have a devastating impact upon our business, on the brewery business in general.”
Nothnagle says the company relies on aluminum for the beer cans, which is one of the main imports facing tariffs.
And he’s even facing tariffs for bottles, which he actually purchases from an American company in Illinois.
“The closest Owens-Illinois factory is somewhere in Virginia, about 10 hours away,” he said. “So essentially, the most environmentally friendly option is getting them from about four or four and a half hours away in Canada. But these would be subject to the tariff, even though it’s an American company.”
Plus, there’s barley stored in a massive silo at the Three Heads site.
“About once every six to eight weeks, we fill this silo with about 50,000 pounds of barley,” said Nothnagle. “This is probably the biggest impact of the tariff would be on our business. Barley is an essential ingredient in beer.”
“So 25% up for grain from Canada, 25% up for aluminum. That goes into beer cans that will have an impact in several brewers across the state,” said economist George Conboy.
Conboy and other finance experts say businesses could take a hit but it may not be permanent.
“Some of the things that we import from Canada, we can look at domestic substitutes or similar imported substitutes from areas with less or no tariff. But some things we import will be difficult or impossible to substitute,” he said.
For folks who operate businesses like Three Heads, a short-term tab can run up fast.
“At some point, what can people afford for a six-pack or 12-pack of beer? And will they take their dollars elsewhere,” states Nothnagle.
Three Heads will hold out and try workarounds and do what it can to help its customers raise a glass without a raise in price.
“We will try our best to avoid a price increase, but if the tariffs drag on for months and months, I think that would be one of our only options. It’s unfortunate,” he said.
Nothnagle has been told that the cost of the tariffs would be charged to his business, so it is a cost that it will have to eat.
He does add that it’s his hope that the tariffs are a negotiating tool that receive the desired effect of strengthening American manufacturing, as Three Heads beer is an American-made product.