In a recent weekly newsletter, Roula Khalaf, the Editor of the Financial Times, highlighted a pressing issue facing the brewing industry. Brewers across Europe are sounding the alarm over a newly imposed 25 percent tariff on beer imports to the United States, predicting that this could lead to significant economic repercussions, including the potential loss of 100,000 jobs and numerous brewery closures throughout Europe. The brewing community is now urging the European Commission to intervene and shield them from this detrimental levy.

This fresh tariff is part of a series of trade measures introduced by US President Donald Trump, which he dubbed "liberation day" tariffs. The decision to impose such a steep tariff has caught brewers off guard, as the financial strain it places on American importers of popular European and Mexican brands, including Heineken and Corona, is expected to be substantial.

Brewers are expressing confusion regarding the specifics of the new tariff, particularly whether it applies to all forms of beer or if it is restricted to beer sold in cans. Julia Leferman, the secretary-general of Brewers of Europe, a trade organization representing major companies such as AB InBev, Heineken, and Molson Coors, stated, "We are calling on the commission to use all diplomatic channels and whether through negotiation or retaliation, find a way to de-escalate this tariff in which we have become collateral victims."

Brewers of Europe, which also advocates for brands like Carlsberg and Asahi, as well as various trade groups across 28 nations, reported that the European Union's directorate-general for trade has made attempts to reach out to US officials. However, these efforts have yielded no clear information regarding the precise nature of the tariffs, which are set to be enforced starting Friday.

The newly implemented 25 percent tariff rate exceeds the 20 percent tariff that is set to apply to all goods imported from the EU into the US. In 2024, European brewers exported approximately €870 million worth of beer to the United States, and the trade group estimates that this move could jeopardize around 100,000 jobs out of the 2 million brewing positions within the EU.

Analysts have pointed out that imports of Mexican beers constitute around 85 percent of the sales for Constellation Brands, the company responsible for producing popular beers like Corona and Modelo. In contrast, Heineken's exposure to the US market is considerably less significant, with their imports accounting for just 3 percent of total group sales.

While Constellation has yet to issue a comment regarding the situation, Heineken has similarly refrained from providing a statement. It’s worth noting that aluminum imports to the US were already under the scrutiny of tariffs prior to the president's announcements this week, which have further escalated the ongoing trade conflict.

Brewers found themselves unexpectedly included in the recent tariff measures when the US Department of Commerce added imports of "beer" alongside "empty aluminum cans" to the list of products subject to the hefty 25 percent tariff. Leferman voiced her bewilderment at this categorization, questioning, "We struggle to understand why beer has been downgraded to be a derivative product of aluminum. It can’t be that we are listed alongside cables and wires."

The vague language of the commerce department’s amendment to its "aluminum presidential proclamation" has left many questions unresolved within the industry. An executive from one international brewer remarked that it is still unclear whether the tariff exclusively impacts beer in cans or all varieties of beer. Another leading brewing company echoed this sentiment, stating that the ambiguous wording is creating confusion and leading them to assume that both beer and beer cans are included.

Analysts at Citi have assessed the situation and suggested that US beverage producers will likely pivot to sourcing more aluminum cans domestically, although they believe the broader effect on the aluminum market will be relatively minor. They noted that the aluminum used for these cans is predominantly sourced from Mexico, Canada, and China.

William Bain, head of trade policy at the British Chambers of Commerce, commented that the inclusion of beer within the tariff structure appears to stem from lobbying efforts by US industries aimed at minimizing foreign competition in the American market. As the brewing industry grapples with these anxious developments, they continue to seek clarity and support from European officials.

Additional reporting by Peter Foster from London has contributed to this article, shedding light on a situation that is rapidly evolving and could have far-reaching consequences for the global beer market.