While the government caught its breath and watched with relief as the US president excluded Mexico from the imposition of new tariffs, beer exporters held their breath again.
The euphoric mood has not reached this sector, which woke up this Wednesday to another blow from the US Department of Commerce. The 25% tariffs, in effect since March 12 on all aluminum and steel imports, will include two very specific derivatives of the former material starting Thursday night: empty cans and beer cans. A blow to an industry that earns some $6.2 billion each year from its sales abroad, the majority of it in Mexico.
The blow will be felt on both sides of the border. Mexico is the world’s leading beer exporter, but the United States is its main importer, investing up to $7.1 billion in the purchase of this product. Neither will Mexican producers be able to change their packaging model overnight, nor will their trading partner be able to immediately absorb a potential drop or increase in supply in this sector; nor will it be able to produce it on its own in the short term.
In fact, Mexico’s Modelo Especial is currently the best-selling beer in the country, after overtaking the American Bud Light a couple of years ago.
Nothing has been heard so far from Mexican manufacturers, who are also the main sellers of aluminum cans in the United States: $149 million, according to the Observatory of Economic Complexity.
The impact is still difficult to measure, but the most immediate effect to foresee is chaos at customs posts as attempts are made to implement the new regulation.
“There’s going to be a lot of fuss about accounting for this. According to this order, the first smelting country must be specified, then the second, then the third. Implementation is going to be very complicated, which is perhaps the goal,” says Valeria Moy, general director of IMCO and an economics expert.
Although the Secretary of Commerce has the discretion to modify the list of what is included or removed from these restrictions, the de facto authority will be checking whether this complies or not, says the economist: “It’s going to be crazy.”
But it’s going to be crazier, she adds, for products packaged in aluminum cans other than beer: what will happen to cans of olives, for example, or Coca-Cola? What will happen to products imported from other countries that have already been subjected to other tariffs? Will they be added to each other? “They’re going to have to add specifications to the specifications; it’s endless,” says Moy.
For three weeks now, Mexico has been imposing 25% tariffs on all goods excluded from the USMCA, the North American free trade agreement, as well as on vehicles and goods containing aluminum or steel. This Wednesday, it dodged Republican President Donald Trump’s announcement of the imposition of new “reciprocal tariffs” on almost every country in the world, but this new indication demonstrates that the truce is always temporary. “We continue working on these issues,”
Mexican President Claudia Sheinbaum stated this morning during her morning press conference, which she attended confident of the previous day’s victory. The peso has appreciated almost two points against the dollar in the last two days. There are reasons for optimism. Also for restraint.
