Recent tariffs imposed have the possibility of increasing liquor prices and may affect the traditional nightlife of a Sun Devil.
President Donald Trump signed executive orders on Feb. 1 to impose 25% tariffs on all goods from Mexico and Canada and 10% tariffs on goods from China, according to an article by NPR. As of March 6, the tariffs on Canada and Mexico have been postponed for one month, per the AP.
Trump said in a social media post the reason behind these tariffs is to stop "the major threat of illegal aliens and deadly drugs killing our Citizens, including fentanyl."
In 2018, the Trump administration imposed 25% tariffs on steel imports and 10% tariffs on aluminum. According to a fact sheet released by the White House, these measures supported the American steel industry and saved the domestic primary aluminum industry from collapsing.
In 2022, under former President Joe Biden, a deal was made to suspend these tariffs and this agreement will last until the end of March.
To protect these American industries "which have been harmed by unfair trade practices and global excess capacity," according to The White House fact sheet, Trump signed proclamations to close loopholes and exemptions for tariffs on metal.
These proclamations will restore a full 25% tariff on steel and raise tariffs on aluminum to 25% from all countries starting March 12, according to the fact sheet.
Cara McDaniel, a clinical professor at the Department of Economics, said looking at only liquor packaging, canned beer will experience a quick price increase because of the aluminum material.
"The cost of business owners acquiring beer and establishments that are beer-centric are going to see costs go up," McDaniel said.
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Canned beer and bottled beer are almost perfect substitutes, McDaniel said. Therefore, if the price of canned beer rises, the demand for bottled beer will also increase and ultimately raise the price of bottled beer as well.
Anything that uses these metals in production is going to experience a decline in profits and loss of employment in those departments, McDaniel said.
These are price increases due to packaging, but consumers and businesses can also expect an increase in price from production costs.
For example, breweries, where there are stainless steel vats and other metal equipment, will be subject to tariffs, McDaniel said.
"Now, it might take a long time for us to really see the effects of those prices because they're not immediate, like cans (and) canned beverages — those prices probably will respond quite quickly," McDaniel said.
How much of a tariff eats into profits of firms and how much is passed on to consumers depends on the consumers' willingness to pay higher prices, McDaniel said.
Places like micro-breweries that are operating on slim margins and unable to absorb these costs may go out of business, McDaniel said.
In terms of the overall economy, McDaniel said, "the economist perspective is: The impact of tariffs is broadly negative, unless you're a producer or employed in the industry that produces."
Matt Bannon has worked at Tops Liquors, a third-generation, women-owned business, for 25 years. They base their pricing "nearly 100%" on what the wholesaler suppliers charges them for any given product, Bannon said.
Certain brands are popularized among students because of nightlife and bars.
No matter what the price is, customers will buy it "to be as much of a trophy as it is a beverage," Bannon said, referring to the commonly found liquor graveyards in ASU students' homes.
Bannon said Top's Liquor has no official plan to prepare for the tariffs, but the market will help figure out what products to reorder and which are not selling.
Nael Jada, the owner of Devil's Liquor, said most brands are expecting an increase in price and are preparing for it. It is not necessarily a bad thing, but it's not looking too bright for the alcohol industry in general, Jada said.
'Try to be as ready as possible; don't let it catch you by surprise," Jada said.
For liquor stores specifically, Jada said preparation can include knowing what products will increase and either not offer them anymore or letting customers know that stores and bars have to increase the price to keep them available.
"Most people, especially if it's a good product, will understand. It's all politics and money," Jada said. "No matter which way you think about it, there has to be a transaction with money."
Ultimately, the effects of these recent tariffs will reach businesses and consumers alike. While some industries may benefit, small businesses and price-conscious consumers will feel the strain. The market will decide the true impact of these tariffs in the months ahead.
This story was corrected on March 19 at 5:55 p.m. to fix the spelling of Nael Jada's name.
Edited by Senna James, Sophia Ramirez and Natalia Jarrett.
Reach the reporter at nrodri74@asu.edu.
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Natalia is a sophomore studying journalism and mass communication with a minor in creative writing. This is her second semester at The State Press.
