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Nov. 26, 2020

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Clark County brewers hit by nationwide aluminum shortage

Local microbrewing industry feels pinch, works to keep prices down

By , Columbian business reporter
8 Photos
Suds from 54?40' Brewing's 1862 Mexican Lager overflow aluminum cans during a production run at the brewery in Washougal. Portland-based Craft Canning supplies contract canning services for 54?40' and several other Clark County breweries.
Suds from 54?40' Brewing's 1862 Mexican Lager overflow aluminum cans during a production run at the brewery in Washougal. Portland-based Craft Canning supplies contract canning services for 54?40' and several other Clark County breweries. (Photos by Joshua Hart/The Columbian) Photo Gallery

One of the many tangential impacts of the COVID-19 pandemic is a nationwide shortage of aluminum cans. America’s major beer and soda producers have been sounding the alarm for months, and Clark County’s microbrewing industry is beginning to feel the pressure as well.

Recent quarterly financial reports from leading can manufacturers like Ball Corp. and Crown Holdings have chronicled an upswing in demand for canned beverages in North America this year, and both companies have announced new production plants or lines next year.

Ball recently estimated that the U.S. market is short about 10 billion cans this year, according to a report in The Washington Post.

The shortage stems from three primary causes, according to Ryan McFarland of Portland-based Craft Canning, which provides contract canning services for microbreweries that are too small to have their own production lines.

The first is new tariffs on imported aluminum sheet metal, which went into effect about a year ago.

The second is the pandemic, which has increased demand for canned beer because more people are staying home or getting beer to go. Craft Canning has taken on far more new clients this year than usual, McFarland said — about 80 total, including some in Clark County — because microbreweries that previously sold most of their beer on tap at bars and brewpubs have had to rapidly pivot to canned offerings.

The third culprit: hard seltzer. That beverage category has exploded in popularity in the past couple years, led by a mix of new labels like White Claw and Truly as well as new hard seltzer lines under existing brand names like Bud Light.

“There’s a huge, huge market demand for that,” McFarland said. “You go into any grocery store or liquor store, you see Corona Seltzer, White Claw (on display).”

Hard seltzers are usually packaged in “sleek”-style cans that are taller and skinnier than regular 12-ounce soda and beer containers. The skyrocketing demand for sleek cans has created more competition for the same limited supply of aluminum production capacity, McFarland said.

Local adjustments

Richard Tiffany, co-owner of Brothers Cascadia Brewing in Hazel Dell, and Bryan Shull, co-owner of Trap Door Brewing in Vancouver, both said they’ve only run into minor issues so far involving 32-ounce “crowler” cans, which tend to be produced in small batches.

Tiffany said he’s been making sure to order new crowler cans well in advance, and Shull said Trap Door has begun buying larger orders of crowlers to keep on hand because it’s become trickier to source them one pallet at a time — plus, it’s good to have some excess in case a fellow brewer is running short.

“There’s been a lot of horse trading between local breweries,” he said.

Mike DeFabio, co-owner of Fortside Brewing in Vancouver, said he was able to stay ahead of the shortage by stocking up on supplies of the brewery’s major canned offerings earlier in the year. Fortside did run into some trouble sourcing can lids with the imprint for can-deposit states like Oregon, he said, but got permission to start printing a label on the bottom of its cans instead.

Trap Door, Brothers Cascadia and several other Clark County breweries contract their 12- and 16-ounce canning operations to Craft Canning, which has partially shielded them from the impacts of the can shortage.

Craft Canning is an all-in-one operation, supplying unlabeled silver cans along with the canning equipment and production staff. But the company has to source those cans from manufacturers, McFarland said, and it’s been a constant behind-the-scenes struggle to maintain a steady supply.

So far this year, Craft Canning has managed to avoid canceling any scheduled canning runs, and it’s kept its can prices steady at 16 cents per can — but it’s going to have to raise them soon, McFarland said, because right now cans are at a premium.

The pressure from the shortage began to hit in late July, he said. Craft Canning’s schedule of new can deliveries began to drop from two or three trucks per month to only one. A single truckload supplies enough cans for about a week-and-a-half of operations, he said, so the company has had to devote far more staff hours to procurement efforts.

“It’s essentially two to three people dedicated every day to calling can suppliers, whether we have a relationship with them or not, just seeing what their stock is,” he said.

Craft Canning has a fairly wide footprint, with multiple mobile canning trucks operating out of Portland, Seattle and Denver, but the company is small compared with the likes of PepsiCo and Anheuser-Busch, McFarland said, and those companies tend to get priority because they place the biggest bulk orders.

McFarland said he hopes the planned production line expansions at Ball Corp. and Crown will relieve some of the pressure on the market and allow can prices to drop back down, but it’s too soon to know how long that transition will take or how big an impact it will have.