By Shaun Boyd
DENVER (CBS4) – Rising aluminum prices are hitting Colorado’s craft beer industry hard.
“It’s disruptive for sure and (it’s) increasing our costs,” said Dave Cole, owner of Epic Brewing.
He says 40 percent of the beer they produce is packaged and sold in aluminum cans, and the price of those cans is jumping six to 10 percent.
“It sounds small if it’s a six or 10 percent increase, in terms of our cans, but the packaging material of any beer, at least for a small, independent craft brewery, is the majority of cost. That can is actually more expensive than most of the liquid that goes into it.”
He says aluminum cans account for up to 70 percent of the cost of a beer. And it gets worse. Aluminum is also subject to an obscure fee set by a private entity with no government oversight.
That fee has more than doubled in the last year. Congressman Ken Buck wants to know why. He’s asked the Justice Department to investigate possible anti-trust violations.
“We want make sure that we’re doing everything we can to make sure there isn’t a price manipulation going on in the marketplace,” Buck said.
Cole says, for now, they have no choice but to eat to the added cost.
“There’s no way we can pass on a 6 percent increase especially with so many big, multi-nationals competing in the craft brew space. It’s getting harder and harder for us to be competitive because of these price increases.”
Big breweries are also sounding the alarm over aluminum price increases. Bill Coors wrote an op-ed in the Wall Street Journal saying he is deeply concerned about the impact on the industry. The fee increase alone, he says, will cost Coors tens of millions of dollars a year.